SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                    FORM 10-Q
(Mark One)
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934. For the quarterly period ended June 30, 2001.

                                       or

[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
    Act of 1934. For the Transition period from
    ----------------------------  to ----------------------------------.

Commission File Number:  0-19671

                             LASERSIGHT INCORPORATED
                             -----------------------
             (Exact name of registrant as specified in its charter)


         Delaware                                         65-0273162
--------------------------                                ----------
(State of Incorporation)                       (IRS Employer Identification No.)



          3300 University Blvd., Suite 140, Winter Park, Florida      32792
          -----------------------------------------------------------------
          (Address of principal executive offices)               (Zip Code)

                                 (407) 678-9900
                                 --------------
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.


Yes   X            No
    -----

         The Number of shares of the registrant's Common Stock outstanding as of
August 13, 2001 is 26,437,895.


<PAGE>


                    LASERSIGHT INCORPORATED AND SUBSIDIARIES

Except for the historical information contained herein, the discussion in this
report contains forward-looking statements (within the meaning of Section 21E of
the Exchange Act) that involve risks and uncertainties. LaserSight's actual
results could differ materially from those discussed here. Factors that could
cause or contribute to such differences include, but are not limited to, those
discussed in the sections entitled "Management's Discussion and Analysis of
Financial Condition and Results of Operations - Uncertainties and Other Issues"
in this report and in LaserSight's Annual Report on Form 10-K for the year ended
December 31, 2000. LaserSight undertakes no obligation to update any such
factors or to publicly announce the results of any revisions to any of the
forward-looking statements contained herein to reflect any future events or
developments.

                                      INDEX

PART I.   FINANCIAL INFORMATION

          Item 1.  Condensed Consolidated Financial Statements

                   Condensed Consolidated Balance Sheets as of June 30, 2001 and
                   December 31, 2000

                   Condensed Consolidated Statements of Operations for the Three
                   Month Periods and Six Month Periods Ended June 30, 2001 and
                   2000

                   Condensed Consolidated Statements of Cash Flows for the Six
                   Month Periods Ended June 30, 2001 and 2000

                   Notes to Condensed Consolidated Financial Statements

                   Independent Auditors' Review Report

          Item 2.  Management's Discussion and Analysis of Financial Condition
                   and Results of Operations

          Item 3.  Management's Quantitative and Qualitative Disclosures about
                   Market Risk

PART II.  OTHER INFORMATION

          Item 1.  Legal Proceedings

          Item 2.  Changes in Securities

          Item 3.  Defaults Upon Senior Securities

          Item 4.  Submission of  Matters to a Vote of Security Holders

          Item 5.  Other Information

          Item 6.  Exhibits and Reports on Form 8-K

<PAGE>

                         PART I - FINANCIAL INFORMATION

ITEM 1 -          FINANCIAL STATEMENTS

                    LASERSIGHT INCORPORATED AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                               June 30,          December 31,
                                     ASSETS                      2001                2000
                                                             ------------       ------------
<S>                                                            <C>                <C>
Current assets:                                                (Unaudited)
  Cash and cash equivalents                                  $  4,773,508          8,593,858
  Accounts receivable - trade, net                              9,269,022          9,546,368
  Notes receivable - current portion, net                       3,994,616          4,065,958
  Inventories                                                  12,415,300         12,123,877
  Deferred tax assets                                              55,522             55,522
  Other current assets                                            746,129            272,745
                                                             ------------       ------------
                               Total Current Assets            31,254,097         34,658,328

Notes receivable, less current portion, net                     2,201,730          2,833,393
Property and equipment, net                                     2,092,968          2,398,292
Patents, net                                                    4,633,701          7,204,981
Goodwill, net                                                   3,108,459          3,232,425
Other assets, net                                               1,696,268          1,549,033
                                                             ------------       ------------
                                                             $ 44,987,223         51,876,452
                                                             ============       ============

                     LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
  Accounts payable                                           $  3,837,007          3,870,791
  Accrued expenses                                              5,731,637          7,030,657
  Accrued commissions                                           1,933,310          1,926,996
  Deferred revenue                                              1,556,462          1,149,415
                                                             ------------       ------------
                          Total Current Liabilities            13,059,016         13,977,859

Accrued expenses, less current portion                            370,647            398,767
Deferred royalty revenue, less current portion                    964,000                 --
Deferred income taxes                                              55,522             55,522
Long-term obligations                                             114,530            109,730
Note payable, net of unamortized discount of  $104,172
  at June 30, 2001                                              2,895,828                 --
Commitments and contingencies

Stockholders' equity:
Convertible preferred stock, authorized 10,000,000 shares;
  par value $.001 per share
    Series C - zero and 2,000,000 issued and outstanding at
      June 30, 2001 and December 31, 2000, respectively                --              2,000
Common stock - par value $.001 per share; authorized
  100,000,000 shares; 25,708,311 and 22,920,278 shares
  issued at June 30, 2001 and December 31, 2000, respectively      25,708             22,920
Additional paid-in capital                                     99,939,609         98,594,665
Stock subscription receivable                                  (1,140,000)        (1,140,000)
Accumulated deficit                                           (70,754,990)       (59,602,364)
Less treasury stock, at cost; 145,200 common shares at
  June 30, 2001 and December 31, 2000                            (542,647)          (542,647)
                                                             ------------       ------------
                                                               27,527,680         37,334,574
                                                             ------------       ------------
                                                             $ 44,987,223         51,876,452
                                                             ============       ============
</TABLE>

   See accompanying notes to the condensed consolidated financial statements.

                                       3

<PAGE>
                    LASERSIGHT INCORPORATED AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                   Three Months Ended                   Six Months Ended
                                                        June 30,                             June 30,
                                            --------------------------------------------------------------------
                                                 2001             2000               2001              2000
                                            --------------   --------------     --------------    --------------
<S>                                         <C>                  <C>                 <C>             <C>
Revenues:
    Products                                $    3,103,526       10,653,445          7,101,573        18,485,923
    Royalties                                       98,000          589,502            248,000         1,258,681
    Services                                       265,350          218,100            511,207           411,445
                                            --------------   --------------     --------------    --------------
                                                 3,466,876       11,461,047          7,860,780        20,156,049

Cost of revenue:
    Product cost                                 1,551,632        4,152,907          3,476,189         7,561,431
    Cost of services                               116,754          118,844            224,931           203,916
                                            --------------   --------------     --------------    --------------

Gross profit                                     1,798,490        7,189,296          4,159,660        12,390,702

Research, development and regulatory
  expenses                                         943,857        1,309,514          1,875,161         2,250,230

Other general and administrative expenses        7,285,314        5,553,094         13,913,208        10,581,129
Selling related expenses                         1,498,638        1,988,049          2,659,717         3,606,126
Amortization of intangibles                        177,042          682,697            396,942         1,318,162
                                            --------------   --------------     --------------    --------------
                                                 8,960,994        8,223,840         16,969,867        15,505,417
                                            --------------   --------------     --------------    --------------

Loss from operations                            (8,106,361)      (2,344,058)       (14,685,368)       (5,364,945)

Other income and expenses
  Interest and dividend income                     181,999          237,951            376,382           502,286
  Interest expense                                (164,711)          (8,754)          (203,187)          (11,154)
  Gain on sale of patent                                --               --          3,950,836                --
  Litigation settlement                           (591,289)              --           (591,289)               --
                                            --------------   --------------     --------------    --------------

Net loss before income taxes                    (8,680,362)      (2,114,861)       (11,152,626)       (4,873,813)

Income tax expense                                      --               --                 --                --
                                            --------------   --------------     --------------    --------------

Net loss                                    $   (8,680,362)      (2,114,861)       (11,152,626)       (4,873,813)
                                            ==============   ==============     ==============    ==============

Loss per common share
  Basic and diluted:                        $        (0.36)           (0.10)             (0.47)            (0.25)
                                            ==============   ==============     ==============    ==============

Weighted average number of shares
  outstanding
  Basic and diluted:                            24,135,000       20,340,000        23,826,000         19,787,000
                                            ==============   ==============     =============     ==============

</TABLE>

   See accompanying notes to the condensed consolidated financial statements.

                                       4

<PAGE>

                    LASERSIGHT INCORPORATED AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                     SIX MONTHS ENDED JUNE 30, 2001 AND 2000
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                  2001                2000
                                                             -------------      ---------------
<S>                                                            <C>                   <C>
Cash flow from operating activities
  Net loss                                                   $ (11,152,626)         (4,873,813)
  Adjustments to reconcile net loss to net
    cash used in operating activities:
  Depreciation and amortization                                  1,142,898           1,812,697
  Gain on sale of patent                                        (3,950,836)                 --
  Common stock issued for services                                  60,469                  --
  Options issued in relation to consulting agreement                33,715                  --
  Changes in assets and liabilities:
    Accounts and notes receivable                                  980,351          (7,279,870)
    Inventories                                                   (291,423)         (1,220,098)
    Accounts payable                                               (33,184)            787,663
    Accrued expenses                                              (803,022)          1,887,457
    Deferred revenue                                             1,371,047             287,095
    Other                                                           34,428            (842,934)
                                                             -------------      --------------

Net cash used in operating activities                          (12,608,183)         (9,441,803)

Cash flows from investing activities
  Purchases of property and equipment, net                        (364,298)           (796,044)
  Proceeds from sale of patent, net                              6,365,000                  --
  Acquisition of intangible assets                                      --          (4,513,665)
                                                             -------------      --------------

Net cash provided by (used in) investing activities              6,000,702          (5,309,709)

Cash flows from financing activities
  Proceeds from common stock financing, net                             --          13,202,452
  Proceeds from exercise of stock options and ESPP                  10,333              43,438
  Proceeds from debt financing, net                              2,776,798                  --
                                                             -------------      --------------

Net cash provided by financing activities                        2,787,131          13,245,890
                                                             -------------      --------------

Decrease in cash and cash equivalents                           (3,820,350)         (1,505,622)

Cash and cash equivalents, beginning of period                   8,593,858          11,247,801
                                                             -------------      --------------

Cash and cash equivalents, end of period                     $   4,773,508           9,742,179
                                                             =============      ==============

</TABLE>


   See accompanying notes to the condensed consolidated financial statements.

                                       5

<PAGE>

                    LASERSIGHT INCORPORATED AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                 Six Month Periods Ended June 30, 2001 and 2000


NOTE 1   BASIS OF PRESENTATION

         The accompanying unaudited, condensed consolidated financial statements
         of LaserSight Incorporated and subsidiaries (LaserSight) as of June 30,
         2001, and for the three and six month periods ended June 30, 2001 and
         2000 have been prepared in accordance with accounting principles
         generally accepted in the United States for interim financial
         information and with the instructions to Form 10-Q and Rule 10-01 of
         Regulation S-X. Accordingly, they do not include all of the information
         and note disclosures required by accounting principles generally
         accepted in the United States for complete financial statements. These
         condensed consolidated financial statements should be read in
         conjunction with the consolidated financial statements and notes
         thereto included in LaserSight's annual report on Form 10-K for the
         year ended December 31, 2000. In the opinion of management, the
         condensed consolidated financial statements include all adjustments
         necessary for a fair presentation of consolidated financial position
         and the results of operations and cash flows for the periods
         presented. The results of operations for the three and six month
         periods ended June 30, 2001 are not necessarily indicative of the
         operating results for the full year. The report of KPMG LLP,
         independent auditors, commenting upon their review accompanies the
         condensed consolidated financial statements included in Item 1 of
         Part I.

NOTE 2   PER SHARE INFORMATION

         Basic loss per common share is computed using the weighted average
         number of common shares and contingently issuable shares (to the extent
         that all necessary contingencies have been satisfied). Diluted loss per
         common share is computed using the weighted average number of common
         shares, contingently issuable shares, and common share equivalents
         outstanding during each period. Common share equivalents include
         options, warrants to purchase Common Stock, and convertible Preferred
         Stock and are included in the computation using the treasury stock
         method if they would have a dilutive effect.

NOTE 3   INVENTORIES

         Inventories, which consist primarily of excimer and erbium laser
         systems and related parts and components, are stated at the lower of
         cost or market. Cost is determined using the standard cost method,
         which approximates costs determined on the first-in first-out basis.
         The components of inventories at June 30, 2001 and December 31, 2000
         are summarized as follows:

                                            June 30, 2001     December 31, 2000
                                            -------------     -----------------

         Raw materials                       $  7,622,675          6,704,447
         Work-in-process                          103,312            121,474
         Finished goods                         3,978,231          4,482,276
         Test equipment - clinical trials         711,082            815,680
                                             ------------      -------------
                                             $ 12,415,300         12,123,877
                                             ============      =============

                                      6
<PAGE>
         SEGMENT INFORMATION

         The Company operates principally in three operating segments:
         refractive products, patent services and health care services.
         Refractive product operations primarily involve the development,
         manufacture, and sale of ophthalmic lasers and related devices for use
         in vision correction procedures. Patent services involve the revenues
         and expenses generated from the ownership of certain refractive laser
         procedure patents, and health care services provides health and vision
         care consulting services to hospitals, managed care companies, and
         physicians.

         Operating profit is total revenue less operating expenses. In
         determining operating profit for operating segments, the following
         items have not been considered: general corporate expenses; expenses
         attributable to LaserSight Centers Incorporated a developmental stage
         company in 2000 and non-operating income. Identifiable assets by
         operating segment are those that are used by or applicable to each
         operating segment. General corporate assets consist primarily of cash
         and cash equivalents and income tax accounts.

         The table below summarizes information about reported segments as of
         and for the three months ended June 30:

<TABLE>
<CAPTION>
                                                                                        Depreciation
                                        Operating        Operating                          and            Capital
                                        Revenues       Profit (Loss)       Assets       Amortization    Expenditures
                                        --------       -------------       ------       ------------    ------------
     <S>                               <C>               <C>               <C>             <C>             <C>
     2001
     Operating  segments:
         Refractive products          $  3,103,526      (7,707,190)      36,593,755         432,357          234,514
         Patent services                    98,000          98,000               --              --               --
         Health care services              265,350         (59,148)       3,329,282          70,981           52,000
         General corporate                      --        (438,023)       5,064,186           2,710               --
                                      ------------    ------------     ------------     -----------     ------------
     Consolidated total               $  3,466,876      (8,106,361)      44,987,223         506,048          286,514
                                      ============    ============     ============     ===========     ============

     2000
     Operating  segments:
         Refractive products          $ 10,653,445      (2,046,698)      41,580,197         663,632          564,601
         Patent services                   589,502         460,172        3,342,326         129,330               --
         Health care services              218,100         (86,491)       3,516,826          71,679               --
         General corporate                      --        (601,853)       9,869,146           1,306               --
         Developmental stage
         company - LaserSight
         Centers                                --         (69,188)       2,409,530          69,174               --
                                      ------------    ------------     ------------     -----------     ------------
     Consolidated total               $ 11,461,047      (2,344,058)      60,718,025         935,121          564,601
                                      ============    ============     ============     ===========     ============
</TABLE>

     Amortization of deferred financing costs and discount on note payable of
     $63,612 for the three months ended June 30, 2001, is included as interest
     expense.

                                       7

<PAGE>

         The table below summarizes information about reported segments as of
         and for the six months ended June 30:
<TABLE>
<CAPTION>
                                                                                        Depreciation
                                        Operating        Operating                           and           Capital
                                        Revenues       Profit (Loss)       Assets       Amortization    Expenditures
                                        --------       -------------       ------       ------------    ------------
     <S>                               <C>              <C>              <C>            <C>              <C>
     2001
     Operating  segments:
         Refractive products          $  7,101,573     (13,881,271)      36,593,755         921,898          308,682
         Patent services                   248,000         248,000               --              --               --
         Health care services              511,207        (146,064)       3,329,282         139,248           55,616
         General corporate                      --        (906,033)       5,064,186           5,418               --
                                      ------------    ------------     ------------     -----------     ------------
     Consolidated total               $  7,860,780     (14,685,368)      44,987,223       1,066,564          364,298
                                      ============    ============     ============     ===========     ============

     2000
     Operating  segments:
         Refractive products          $ 18,485,923      (4,921,855)      41,580,197       1,267,167          792,301
         Patent services                 1,258,681       1,000,021        3,342,326         258,660               --
         Health care services              411,445        (193,247)       3,516,826         143,358            3,743
         General corporate                      --      (1,111,502)       9,869,146           5,164               --
         Developmental stage
         company - LaserSight
         Centers                                --        (138,362)       2,406,530         138,348               --
                                      ------------    ------------     ------------     -----------     ------------
     Consolidated total               $ 20,156,049      (5,364,945)      60,718,025       1,812,697          796,044
                                      ============    ============     ============     ===========     ============
</TABLE>

     Amortization of deferred financing costs and discount on note payable of
     $76,334 for the six months ended June 30, 2001, is included as interest
     expense.

NOTE 5   SALE OF INTELLECTUAL PROPERTY

         Sale of Patent
         --------------

         On March 1, 2001, the Company completed the sale of U.S. Patent
         No. 4,784,135 (Blum Patent) for a cash payment of $6.5 million offset
         by expenses of $135,000. The Company retained a non-exclusive royalty
         free license and the rights associated with a third party's license
         under the Blum Patent. Net of costs associated with the sale, the
         Company recognized a gain on the sale of the patent of approximately
         $4.0 million.

NOTE 6   LICENSE AGREEMENT

         Effective January 3, 2001, the Company entered into an amended and
         restated license and royalty agreement related to the Company's
         keratome products. This agreement replaced an agreement originally
         entered into in September 1997 and amended in January 2000. Under the
         terms of the amended and restated license, 730,552 shares of Common
         Stock were issued, valued at approximately $1.1 million, in partial
         payment for royalties during the term of the license. The term of the
         original agreement was extended for three years until July 31, 2005. In
         addition, minimum royalty payments totaling approximately $6.2 million
         will be due in quarterly installments through the term of the
         amendment. As of June 30, 2001, remaining minimum royalty payments
         totaled $5.6 million.  The royalty rate was reduced from 50% to 10% of
         gross profits in the amended and restated license.

                                       8
<PAGE>



NOTE 7   LOAN AGREEMENT

         On March 12, 2001, the Company entered into a loan agreement with
         Heller Healthcare Finance, Inc. (Heller) for a $3.0 million term loan
         at an annual interest rate of prime plus 2.5% (11% at inception date)
         and a revolving loan in an amount of up to 85% of eligible receivables
         related to U.S. sales, but not more than $10.0 million, at an annual
         interest rate of prime plus 1.25% (9.75% at inception date). At
         June 30, 2001, receivables on U.S. sales totaled approximately $4.4
         million. There have been no borrowings under the revolving loan to
         date. The term loan and the revolving loan mature on March 12, 2003. In
         connection with the loans, the Company paid an origination fee of
         $130,000 and issued warrants to purchase 243,750 shares of Common
         Stock. At the termination of the loan, an additional fee of $148,125
         will be payable to Heller. The warrants are exercisable at any time
         from March 12, 2001 through March 12, 2004 at an exercise price per
         share of $3.15. Borrowings under the loan agreement are secured by
         substantially all of the Company's assets. The loan agreement requires
         the Company to meet certain covenants, including the maintenance of a
         minimum level of net worth.

NOTE 8   SUBSEQUENT EVENT

         Private Placement
         -----------------

         On July 6, 2001, the Company closed a transaction for the sale of
         1,276,596 shares of Series F convertible participating preferred stock,
         convertible into Common Stock on a share for share basis, to a total of
         two investors in exchange for the Company receiving $3.0 million in
         cash. In addition, the investors received a total of 838,905 shares of
         Common Stock under price protection provisions of the Company's
         September 2000 private placement.

         An additional amount up to $4.0 million may be raised before the end of
         2001 if, on or prior to October 1, 2001, the Company receives written
         notice from the FDA that the LaserScan LSX has been approved or is
         approvable to treat myopic astigmatism. In that case, if the three-day
         volume weighted average price of the Company's common stock exceeds
         $2.75, the Company may elect, during the 10-day period following the
         FDA approval, to sell 800,000 shares of our series G convertible
         participating preferred stock to the same investors. The per share
         purchase price for such series G preferred stock will be $2.50
         (resulting in a $2.0 million investment in series G preferred stock).
         If the Company receives the FDA approval but does not elect to sell the
         series G preferred stock as described above, the investors, for a
         period of 30 days following the expiration of the Company's election
         period, may elect to purchase shares of series G preferred stock at a
         per share purchase price of 85% of the ten-day volume weighted average
         price, limited to an aggregate purchase price of $4.0 million.

                                       9
<PAGE>



                       Independent Auditors' Review Report

The Board of Directors
LaserSight Incorporated:

We have reviewed the condensed consolidated balance sheet of LaserSight
Incorporated and subsidiaries as of June 30, 2001, and the related condensed
consolidated statements of operations and cash flows for the three-month and
six-month periods ended June 30, 2001 and 2000. These condensed consolidated
financial statements are the responsibility of the Company's management.

We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with auditing standards generally accepted in the United States of America, the
objective of which is the expression of an opinion regarding the financial
statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should
be made to the condensed consolidated financial statements referred to above for
them to be in conformity with accounting principles generally accepted in the
United States of America.

We have previously audited, in accordance with auditing standards generally
accepted in the United States of America, the consolidated balance sheet of
LaserSight Incorporated and subsidiaries as of December 31, 2000, and the
related consolidated statements of operations, comprehensive loss, stockholders'
equity, and cash flows for the year then ended (not presented herein); and in
our report dated February 9, 2001, except as to note 16, which is as of March
12, 2001, we expressed an unqualified opinion on those consolidated financial
statements. In our opinion, the information set forth in the accompanying
condensed consolidated balance sheet as of December 31, 2000, is fairly stated,
in all material respects, in relation to the consolidated balance sheet from
which it has been derived.


                                  /s/ KPMG LLP

St. Louis, Missouri
July 27, 2001


                                       10
<PAGE>


ITEM 2.           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                  CONDITION AND RESULTS OF OPERATIONS

         LaserSight is principally engaged in the manufacture and supply of
narrow beam scanning excimer laser systems, keratomes, keratome blades and other
related products used to perform procedures that correct common refractive
vision disorders such as nearsightedness, farsightedness and astigmatism. Since
1994, we have marketed our laser systems commercially in over 30 countries
worldwide and currently have an installed base of over 350 laser systems,
including approximately 180 of our LaserScan LSX(TM) laser systems. In March
2000, we began commercial shipments of our LaserScan LSX laser system to
customers in the U.S.

New Accounting Pronouncements

         In July 2001, the FASB issued SFAS No. 141, "Business Combinations",
and SFAS No. 142, "Goodwill and Other Intangible Assets". SFAS No. 141 requires
that the purchase method be used for all business combinations initiated after
June 30, 2001 and eliminates the pooling-of-interests method.  SFAS No. 142
requires that goodwill no longer be amortized regularly as a charge to earnings.
As a result, the amortization of goodwill is eliminated upon adoption of SFAS
No. 142, which will be January 1, 2002.  In addition, SFAS No. 142 requires an
initial (and annually thereafter) test of the goodwill's impairment.

         Management does not expect SFAS No. 141 to have a material effect on
the consolidated financial statements. Management does expect SFAS No. 142 to
result in the elimination of amortization of goodwill from previous acquisitions
in the amount of approximately $240,000 in 2002. Management will test for
impairment of goodwill from previous acquisitions at least annually.

Results of Operations

         The following table sets forth for the periods indicated information
derived from our statements of operations for those periods expressed as a
percentage of net sales, and the percentage change in such items from the
comparable prior year period. Any trends illustrated in the following table are
not necessarily indicative of future results.

<TABLE>
<CAPTION>
                                                                                           Percent Increase (Decrease)
                                          As a Percentage of Net Revenues                      Over Prior Periods
                                          -------------------------------                      ------------------
                                       Three Months             Six Months            Three Months         Six Months
                                          Ended                    Ended                Ended                Ended
                                         June 30,                 June 30,             June 30,            June 30,
                                     2001        2000          2001      2000       2001 vs. 2000        2001 vs. 2000
                                     ----        ----          ----      ----       -------------        -------------

<S>                                  <C>         <C>           <C>       <C>             <C>                <C>
Statement of Operations Data:
Net Revenues:
   Refractive products..........     89.5%       93.0%         90.3%     91.7%           (70.9)             (61.6)
   Patent service...............      2.8         5.1           3.2       6.2            (83.4)             (80.3)
   Healthcare services..........      7.7         1.9           6.5       2.1             21.7               24.2
                                    -----       -----         -----     -----
       Net Revenues.............    100.0       100.0         100.0     100.0            (69.8)             (61.0)
Cost of Revenue.................     48.1        37.3          47.1      38.5            (60.9)             (52.3)
                                    -----       -----         -----     -----
Gross Profit (1)................     51.9        62.7          52.9      61.5            (75.0)             (66.4)
Research, development and
   regulatory expenses (2)......     27.2        11.4          23.9      11.2            (27.9)             (16.7)
Other general and administrative
   expenses.....................    210.2        48.5         177.0      52.5             31.2               31.5
Selling-related expenses (3)....     43.2        17.3          33.8      17.9            (24.6)             (26.2)
Amortization of intangibles.....      5.1         6.0           5.0       6.5            (74.1)             (69.9)
                                    -----       -----         -----     -----
Loss from operations............   (233.8)      (20.5)       (186.8)    (26.6)           245.8              173.7
</TABLE>

---------------
(1)      As a percentage of net revenues, the gross profit for refractive
         products only for the three months ended June 30, 2001 and 2000, and
         the six months ended June 30, 2001 and 2000, was 50%, 61%, 51% and
         59%, respectively.

                                       11
<PAGE>

(2)      As a percentage of refractive product net sales, research, development
         and regulatory expenses for each of the three months ended June 30,
         2001 and 2000, and the six months ended June 30, 2001 and 2000, were
         30%, 12%, 26% and 12%, respectively.

(3)      As a percentage of refractive product net sales, selling-related
         expenses for the three months ended June 30, 2001 and 2000, and the six
         months ended June 30, 2001 and 2000, were 48%, 19%, 37% and 20%,
         respectively.

THREE MONTHS ENDED JUNE 30, 2001, COMPARED TO THREE MONTHS ENDED JUNE 30, 2000

         Revenues. Net revenues for the three months ended June 30, 2001
decreased by $8.0 million, or 70%, to $3.5 million from $11.5 million for the
comparable period in 2000.

         During the three months ended June 30, 2001, refractive products
revenues decreased $7.5 million, or 71%, to $3.1 million from $10.6 million for
the comparable period in 2001. This revenue decrease was primarily the result of
decreased sales of the LaserScan LSX excimer laser system. During the three
months ended June 30, 2001, excimer laser system sales accounted for
approximately $2.8 million in revenues compared to $9.9 million in revenues over
the same period in 2000. During the three months ended June 30, 2001, 10 laser
systems were sold compared to 30 laser systems sold during the comparable period
in 2000. The reduction in laser sales is primarily attributable to the delayed
FDA approval of our laser in the U.S. for the treatment of astigmatism.

         Net revenues from patent services for the three months ended June 30,
2001 decreased approximately $0.5 million, or 83%, to $0.1 million from $0.6
million for the comparable period in 2000. This revenue decrease was due to the
March 2001 sale of most rights associated with the patent responsible for
generating patent service revenue.

         Net revenues from health care services for the three months ended June
30, 2001 increased approximately $47,000 from the comparable period in 2000.

         Cost of Revenues; Gross Profit. For the three months ended June 30,
2001 and 2000, gross profit margins were 52% and 63%, respectively. The gross
margin decrease during the three months ended June 30, 2001 was primarily
attributable to decreased sales of the LaserScan LSX excimer laser system. The
decreased sales resulted in lower raw material costs relating to the LaserScan
LSX excimer laser system of $2.0 million, partially offset by a decrease in our
inventory obsolescence reserve of $0.2 million from the comparable period in
2000.

         Research, Development and Regulatory Expenses. Research, development
and regulatory expenses for the three months ended June 30, 2001, decreased $0.4
million, or 28%, to $0.9 million from $1.3 million for the comparable period in
2000. We continued to develop our keratome systems and excimer laser systems and
continued to pursue protocols in our effort to attain and expand our FDA
approvals for our refractive products. As a result of the anticipated completion
of some of these efforts in the near future along with the continuation of the
development of our AstraMax diagnostic workstation, we expect research and
development expenses during the remainder of 2001 to decline from the levels
incurred during the first half of 2001. Regulatory expenses are expected to
remain constant as a result of our continued pursuit of various FDA approvals,
including pre-market approval supplements, and the possible development of
additional pre-market approval supplements and future protocols for submission
to the FDA.

         Other General and Administrative Expenses. Other general and
administrative expenses for the three months ended June 30, 2001 increased $1.7
million, or 31%, to $7.3 million from $5.6 million for the comparable period in
2000. This increase was due to an increase in expenses incurred at our
refractive products subsidiary of approximately $1.9 million related to
enhancements to the customer support and training, sales and marketing and
software development departments of $0.9 million, and $1.1 million of legal fees

                                       12
<PAGE>

related to patent issues and litigation. The patent litigation, which accounted
for a significant portion of those legal fees, was settled in May 2001, and we
expect to experience a decrease in our legal expenses during the remainder of
2001.

         Selling-Related Expenses. Selling-related expenses consist of those
items directly related to sales activities, including commissions on sales,
royalty or license fees, warranty expenses, and costs of shipping and
installation. Commissions and royalties, in particular, can vary significantly
from sale to sale or period to period depending on the location and terms of
each sale. Selling-related expenses for the three months ended June 30, 2001
decreased $0.5 million, or 25%, to $1.5 million from $2.0 million during the
comparable period in 2000. This decrease was primarily attributable to a $0.3
million decrease in sales commissions resulting from lower sales and a decrease
of $0.5 million of warranty expense primarily related to decreased laser system
sales. Selling-related expenses increased as a percentage of revenue during the
three months ended June 30, 2001 over the comparable period in 2000. This
increase primarily resulted from additional license fee expense for our keratome
products of $0.3 million due to minimum royalties under our January 2001 amended
and restated license agreement, regardless of keratome sales, and a higher
proportion in 2001 of international laser sales, which include a royalty, to
total sales.

         Amortization of Intangibles. During the three months ended June 30,
2001, amortization of intangible assets decreased $0.5 million, or 74%, to $0.2
million from $0.7 million for the comparable period in 2000. This decrease was
due to the impairment loss incurred on certain intangible assets at December 31,
2000 of approximately $4.1 million, reducing future amortization expenses, and
the sale of the Blum Patent in March 2001 that had an unamortized book value of
approximately $2.4 million. Our intangible assets include acquired technologies,
patents, license agreements and goodwill.

         Loss From Operations. The operating loss for the three months ended
June 30, 2001 was $8.1 million compared to the operating loss of $2.3 million
for the same period in 2000. This increase in the loss from operations was
primarily due to the decrease in sales of our LaserScan LSX excimer laser system
and an increase in other general and administrative expenses related to our
refractive products operations.

         Other Income and Expenses. Interest and dividend income for the three
months ended June 30, 2001 was $0.2 million, a decrease of $0.1 million over the
comparable period in 2000. Interest and dividend income was earned from the
investment of cash and cash equivalents and the collection of long-term
receivables related to laser system sales. Interest expense of approximately
$0.2 million for the three months ended June 30, 2001 was primarily attributable
to the loan and credit facility we established in March 2001. Other expenses for
the three months ended June 30, 2001 included approximately $0.6 million in
payments related to the settlement of patent litigation.

         Income Taxes.  For the three months ended June 30, 2001 and 2000,
LaserSight had no income tax expense.

         Net Loss. Net loss for the three months ended June 30, 2001, was $8.7
million compared to a net loss of $2.1 million for the comparable period in
2000. The increased net loss for the three months ended June 30, 2001 can be
attributed to the decrease in sales of our LaserScan LSX excimer laser system
and an increase in other general and administrative expenses related to our
refractive products operations.

         Loss Per Share. The loss per basic and diluted share was $0.36 for the
three months ended June 30, 2001 and $0.10 for the comparable period in 2000.
During the three months ended June 30, 2001, the weighted average shares of
common stock outstanding increased primarily due to the conversion of preferred
stock during 2000 and 2001, the September 2000 private placement of common stock
and the issuance of shares in connection with the amended and restated license
and royalty agreement related to our keratome products.

                                       13
<PAGE>

SIX MONTHS ENDED JUNE 30, 2001, COMPARED TO SIX MONTHS ENDED JUNE 30, 2000

         Revenues. Net revenues for the six months ended June 30, 2001 decreased
by $12.3 million, or 61%, to $7.9 million from $20.2 million for the comparable
period in 2000.

         During the six months ended June 30, 2001, refractive products revenues
decreased $11.4 million, or 62%, to $7.1 million from $18.5 million for the
comparable period in 2000. This revenue decrease was primarily the result of
decreased sales of the LaserScan LSX excimer laser system. During the six months
ended June 30, 2001, excimer laser system sales accounted for approximately $6.4
million in revenues compared to $16.0 million in revenues over the same period
in 2000. During the six months ended June 30, 2001, 23 laser systems were sold
compared to 49 laser systems sold during the comparable period in 2000. The
reduction in laser sales is primarily attributable to the delayed FDA approval
of our laser in the U.S. for the treatment of astigmatism.

         Net revenues from patent services for the six months ended June 30,
2001 decreased approximately $1.0 million, or 80%, to $0.3 million from $1.3
million for the comparable period in 2000, due to the March 2001 sale of most
rights associated with the patent responsible for generating patent service
revenue.

         Net revenues from health care services for the six months ended June
30, 2001 increased approximately $100,000 from the comparable period in 2000.

         Cost of Revenues; Gross Profit. For the six months ended June 30, 2001
and 2000, gross profit margins were 53% and 61%, respectively. The gross margin
decrease during the six months ended June 30, 2001 was primarily attributable to
decreased sales of the LaserScan LSX excimer laser system. The decreased sales
resulted in lower raw material costs relating to the LaserScan LSX excimer laser
system of $3.0 million, partially offset by a decrease in our inventory
obsolescence reserve of $0.4 million from the comparable period in 2000.

         Research, Development and Regulatory Expenses. Research, development
and regulatory expenses for the six months ended June 30, 2001 decreased $0.4
million, or 17%, to $1.9 million from $2.3 million for the comparable period in
2000. We continued to develop our keratome systems and excimer laser systems and
continued to pursue protocols in our effort to attain and expand our FDA
approvals for our refractive products. As a result of the anticipated completion
of some of these efforts in the near future along with the continuation of the
development of our AstraMax diagnostic workstation, we expect research and
development expenses during the remainder of 2001 to decline from the levels
incurred during the first half of 2001. Regulatory expenses are expected to
remain constant as a result of our continued pursuit of various FDA approvals,
including pre-market approval supplements, and the possible development of
additional pre-market approval supplements and future protocols for submission
to the FDA.

         Other General and Administrative Expenses. Other general and
administrative expenses for the six months ended June 30, 2001 increased $3.3
million, or 31%, to $13.9 million from $10.6 million for the comparable period
in 2000. This increase was due to an increase in expenses incurred at our
refractive products subsidiary of approximately $3.5 million related to
enhancements to the customer support and training, sales and marketing and
software development departments of $1.3 million, higher depreciation costs of
$0.1 million and $2.0 million of legal fees related to patent issues and
litigation. The patent litigation, which accounted for a significant portion of
those legal fees, was settled in May 2001, and we expect to experience a
decrease in our legal expenses during the remainder of 2001.

         Selling-Related Expenses. Selling-related expenses consist of those
items directly related to sales activities, including commissions on sales,
royalty or license fees, warranty expenses, and costs of shipping and
installation. Commissions and royalties, in particular, can vary significantly
from sale to sale or period to period depending on the location and terms of
each sale. Selling-related expenses for the six months ended June 30, 2001
decreased $0.9 million, or 26%, to $2.7 million from $3.6 million during the
comparable period in 2000. This decrease was primarily attributable to a $0.6
million decrease in sales commissions resulting from lower sales and a decrease
of $0.6 million of warranty expense primarily related to decreased laser system
sales. Selling-related expenses increased as a percentage of revenue during the
three months ended June 30, 2001 over the comparable period in 2000. This
increase primarily resulted from additional license fee expense for our keratome

                                       14
<PAGE>

products of $0.4 million due to minimum royalties under our January 2001 amended
and restated license agreement, regardless of keratome sales, and a higher
proportion in 2001 of international laser sales, which include a royalty, to
total sales.

         Amortization of Intangibles. During the six months ended June 30, 2001,
costs relating to the amortization of intangible assets decreased $0.9 million,
or 70%, to $0.4 million from $1.3 million for the comparable period in 2000.
This decrease was due to the impairment loss incurred on certain intangible
assets at December 31, 2000 of approximately $4.1 million, reducing future
amortization expenses, and the sale of the Blum Patent in March 2001 that had an
unamortized book value of approximately $2.4 million. Our intangible assets
include acquired technologies, patents, license agreements and goodwill.

         Loss From Operations. The operating loss for the six months ended June
30, 2001 was $14.7 million compared to the operating loss of $5.4 million for
the same period in 2000. This increase in the loss from operations was primarily
due to the decrease in sales of our LaserScan LSX excimer laser system and an
increase in other general and administrative expenses related to our refractive
products operations.

         Other Income and Expenses. Interest and dividend income for the six
months ended June 30, 2001 was $0.4 million, a decrease of $0.1 million over the
comparable period in 2000. Interest and dividend income was earned from the
investment of cash and cash equivalents and the collection of long-term
receivables related to laser system sales. Interest expense of approximately
$0.2 million for the six months ended June 30, 2001 was primarily attributable
to the loan and credit facility we established in March 2001. Other income
included a net gain, after expenses associated with the sale, of $4.0 million
from the sale of the Blum Patent in March 2001. The patent was sold for $6.5
million and, prior to the sale, had a book value of approximately $2.4 million.
Other expenses for the six months ended June 30, 2001 included approximately
$0.6 million in payments related to the settlement of patent litigation.

         Income Taxes.  For the six months ended June 30, 2001 and 2000,
LaserSight had no income tax expense.

         Net Loss. Net loss for the six months ended June 30, 2001, was $11.2
million compared to a net loss of $4.9 million for the comparable period in
2000. The increased net loss for the six months ended June 30, 2001 can be
attributed to the decrease in sales of our LaserScan LSX excimer laser system
and an increase in other general and administrative expenses related to our
refractive products operations, partially offset by the gain generated by the
sale of the Blum Patent.

         Loss Per Share. The loss per basic and diluted share was $0.47 for the
six months ended June 30, 2001 and $0.25 for the comparable period in 2000.
During the six months ended June 30, 2001, the weighted average shares of common
stock outstanding increased primarily due to the conversion of preferred stock
during 2000 and 2001, the September 2000 private placement of common stock and
the issuance of shares related to the amended and restated license and royalty
agreement related to our keratome products.

LIQUIDITY AND CAPITAL RESOURCES

         Our principal sources of funds have historically been from sales of
preferred stock and common stock, sales of subsidiaries and patent rights and,
to a lesser extent, our operating cash flows. We issued equity securities
totaling approximately $14.8 million in 1997, $15.8 million in 1998, $8.9
million in 1999, $19.1 million in 2000 and $3.0 million through August 13, 2001,
and received proceeds from the exercise of stock options, warrants and our
Employee Stock Purchase Plan of approximately $98,000 in 1997, $0.5 million in
1998, $10.4 million in 1999, $85,000 in 2000 and $60,000 to date in 2001. In
addition, we sold subsidiaries and various patent rights, resulting in proceeds
to us of approximately $10.5 million in 1997, $12.7 million in 1998 and $6.5
million to date in 2001. We have principally used these capital resources to
fund operating losses, working capital requirements, capital expenditures,
acquisitions and retirement of debt. At June 30, 2001, we had an accumulated
deficit of $70.8 million.

                                       15
<PAGE>

         On March 1, 2001, we completed the sale of U.S. Patent No. 4,784,135
(Blum Patent) for a cash payment of $6.4 million, net of related expenses. We
retained a non-exclusive royalty free license under the patent, which relates to
the use of ultraviolet light for the removal of organic tissue. Our net book
value of the patent at the date of the sale was approximately $2.4 million.

         On March 12, 2001, we established a $3.0 million term loan and $10.0
million revolving credit facility with Heller. We borrowed $3.0 million under
the term loan at a rate per annum equal to two and one-half percent (2 1/2%)
above the prime rate. Interest is payable monthly and the loan must be repaid on
March 12, 2003. Under the credit facility, we have the option to borrow amounts
at a rate per annum equal to one and one-quarter percent (1 1/4%) above the
prime rate for short-term working capital needs or such other purposes as may be
approved by Heller. Borrowings are limited to 85% of qualified accounts
receivable related to U.S. sales. Borrowings under the loans are secured by
substantially all of the Company's assets. The term loan and credit facility
require us to meet certain covenants, including the maintenance of a minimum net
worth. The terms of the loans extend to March 12, 2003. In addition to the costs
and fees associated with the transaction, we issued to Heller a warrant to
purchase 243,750 shares of common stock at an exercise price of $3.15 per share.
The warrant expires on March 12, 2004. At August 13, 2001, we had no borrowings
under the credit facility.

         Our working capital decreased $2.5 million from $20.7 million at
December 31, 2000 to $18.2 million as of June 30, 2001. This decrease in working
capital resulted primarily from cash used in operating activities of $12.6
million offset by cash generated from the sale of a patent and the proceeds of
the term loan, for net proceeds of $9.0 million.

         Operating activities used net cash of $12.6 million during the six
months ended, June 30, 2001, compared to $9.4 million of net cash used during
the same period in 2000, and $15.7 million during the year ended December 31,
2000. We expect to incur a loss and a deficit in cash flow from operations for
the third quarter of 2001. There can be no assurance that we can regain or
sustain profitability or positive operating cash flow in any subsequent fiscal
period. Net cash provided by investing activities of $6.0 million during the six
months ended June 30, 2001, can be attributed primarily to the sale of the Blum
patent. As of June 30, 2001, we had no significant commitments for capital
expenditures. Net cash provided from financing activities during the six months
ended June 30, 2001 of $2.8 million can be attributed to entering into the term
loan agreement.

         On July 6, 2001, we completed a $3.0 million placement of series F
convertible participating preferred stock. An additional amount up to $4.0
million may be raised before the end of the year if on or prior to October 1,
2001, we receive written notice from the FDA that our LaserScan LSX has been
approved or is approvable to treat myopic astigmatism. In that case, if the
three-day volume weighted average price of our common stock exceeds $2.75, we
may elect, during the 10-day period following the FDA approval, to sell 800,000
shares of our series G convertible participating preferred stock to the same
investors. The per share purchase price for the series G preferred stock will be
$2.50 (resulting in a $2.0 million investment in series G preferred stock). If
we receive the approval but do not elect to sell our series G preferred stock as
described above, the investors, for a period of 30 days following the expiration
of our election period, may elect to purchase shares of series G preferred stock
at a per share purchase price of 85% of the ten-day volume weighted average
price, limited to an aggregate purchase price of $4.0 million.

         We are exploring opportunities for additional equity financing through
a private placement of our common stock. If we experience unanticipated delays
in obtaining FDA approval for the treatment of astigmatism or the commercial
release of our UltraShaper durable keratome or AstraMax diagnostic workstation,
we will be required to seek additional debt or equity financing during the next
12 months. There can be no assurance that the assumptions underlying our
business plan will be met or that additional financing will not be needed or
that financing, if needed, would be available. Our belief regarding future
working capital requirements is based on various factors  and assumptions
including: the successful reduction of a significant amount of  expenses
currently being implemented, the uncertain timing of astigmatism and  other
supplemental FDA approvals for our LaserScan LSX excimer laser system, which
could continue to negatively impact our sales during 2001, potential growth in
laser sales after receipt of further FDA approvals, increases in accounts
receivable and inventory purchases when sales increase, the potential for
borrowing under our revolving

                                       16
<PAGE>

credit facility, the uncertain impact of the market introduction of our
UltraShaper(TM) durable keratomes, commercial acceptance of our UltraEdge(TM)
keratome blades and UniShaper(TM) single-use keratomes, which we believe is
partially dependent upon the successful introduction of the UltraShaper, the
anticipated timely collection of receivables, and the absence of unanticipated
product development and marketing costs. See "Risk Factors and
Uncertainties--Industry and Competitive Risks--We cannot assure you that our
keratome products will achieve market acceptance" and "--We cannot assure you
that our LaserScan LSX laser system will achieve market acceptance in the U.S.,
and our business model for selling our laser system in the U.S. is new and
unproven." These factors and assumptions are subject to certain contingencies
and uncertainties, some of which are beyond our control. Similarly, our
long-term liquidity will be dependent on the successful entrance into the U.S.
market of our laser systems, the successful entrance into U.S. and
international markets of our diagnostic workstation and keratome products, and
our ability to collect our receivables on a timely basis. We may seek additional
debt or equity financing in the future to implement our business plan or any
changes thereto in response to future developments or unanticipated
contingencies. Other than the $10.0 million credit facility completed in March
2001 with Heller and the possible series G preferred stock issuance described
above, we currently do not have any commitments for additional financing. See
"Risk Factors and Uncertainties--Financial and Liquidity Risks--We could require
additional financing, which might not be available if we need it."

                                       17


<PAGE>

                                  RISK FACTORS

         The business, results of operations and financial condition of
LaserSight and the market price of our common stock may be adversely affected by
a variety of factors, including the ones noted below:

INDUSTRY AND COMPETITIVE RISKS

         WE CANNOT ASSURE YOU THAT OUR LASERSCAN LSX LASER SYSTEM WILL ACHIEVE
MARKET ACCEPTANCE IN THE U.S., AND OUR BUSINESS MODEL FOR SELLING OUR LASER
SYSTEM IN THE U.S. IS NEW AND UNPROVEN.

         We received the FDA approval necessary for the commercial marketing and
sale of our LaserScan LSX excimer laser system in the U.S. in late 1999 and
commercial shipments to customers in the U.S. began in March 2000. Our previous
experience marketing and selling our LaserScan LSX excimer laser system in the
U.S. had been limited to cost-recovery sales to refractive surgeons
participating in our FDA clinical trials.

         The required level of per procedure fees payable to us by refractive
surgeons upon receipt of anticipated FDA approval for treatment of myopia with
astigmatism may not be accepted by the marketplace or may exceed those charged
by our competitors. While we believe that gaining access to our scanning
microspot laser technology justifies the required per procedure fee levels, we
cannot assure you that this business model will be accepted by a large number of
refractive surgeons. If our competitors reduce or do not charge per procedure
fees to users of their systems, we could be forced to reduce or eliminate the
fees charged under this business model, which could significantly reduce our
revenues. For example, Nidek Co., Ltd., one of our competitors, has publicly
stated that it will not charge per procedure fees to users of its laser systems
in the U.S. and internationally. See also "--Company and Business
Risks--Required per procedure fees payable to Visx under our license agreement
may exceed per procedure fees collected by us."

         Successful implementation of this business model is crucial to our
success in selling our LaserScan LSX laser system in the U.S. and may require
the expenditure of significant financial and other resources to create awareness
of the LaserScan LSX laser system and create demand by refractive surgeons. If
our laser system fails to achieve market acceptance in the U.S., we may not be
able to execute our business plan, which would have a material adverse effect on
our business, financial condition and results of operations.

         WE CANNOT ASSURE YOU THAT OUR KERATOME PRODUCTS WILL ACHIEVE MARKET
ACCEPTANCE.

         Keratomes are surgical devices used to create a corneal flap
immediately prior to LASIK laser vision correction procedures. We began to roll
out our MicroShape(TM) family of keratome products with the commercial launch of
our UltraEdge keratome blades in July 1999 and of our UniShaper single-use
keratomes and control consoles in December 1999. In August 2001, we expect to
authorize the commercial release of our UltraShaper durable keratomes after a
thorough process of engineering refinement and validity testing. Our UniShaper
single-use keratome was the first disposable keratome product to be commercially
marketed, and we cannot assure you that refractive surgeons, including in
particular refractive surgeons who perform a large volume of LASIK procedures,
will accept our UniShaper product as either a replacement for or a supplement to
the durable keratomes traditionally used to create corneal flaps. In our recent
experience, many surgeons are reluctant to use a disposable keratome product as
their primary keratome. Also, market acceptance of the UniShaper may be hindered
by surgeons needing to alter their surgical technique in order to achieve the
desired clinical results. Our UltraShaper durable keratome incorporates the
features found in the Automated Corneal Shaper (ACS) keratome previously
marketed by Bausch & Lomb, Inc. with new enhancements and features. However,


                                       18
<PAGE>

Bausch & Lomb has not aggressively marketed or serviced the ACS since 1997 when
we licensed the rights to commercially market keratomes based on the same
technology, and has successfully transitioned a large number of refractive
surgeons from the ACS to its Hansatome durable keratome product. We believe that
many refractive surgeons learned to perform the LASIK procedure using the ACS
and prefer the surgical technique required by the ACS, which is also used to
operate our UltraShaper durable keratome, to the surgical technique required to
operate the Hansatome keratome product. However, we cannot assure you that we
will be successful in commercially introducing or achieving broad market
acceptance of our UltraShaper durable keratome or our other keratome products.

         We have previously indicated that the successful implementation of our
keratome product sales strategy is in part dependent upon our marketing and
distribution alliance with Becton Dickinson. Due to the delay in the commercial
launch of our UltraShaper durable keratome we initiated discussions with Becton
Dickinson in order to modify our manufacturing and marketing agreements. While
these discussions were ongoing we received notices from Becton Dickinson
claiming that they have the right to end our marketing arrangement in six months
and that they are not bound by the terms of our manufacturing agreement.
Following our receipt of these notices, Becton Dickinson indicated a willingness
to discuss modified terms for a marketing and manufacturing relationship. While
we do not agree that Becton Dickinson has the right to unilaterally end our
current agreements, we intend to discuss mutually beneficial modified
agreements. If we cannot successfully market and sell our keratome products or
if we are unable to successfully modify or replace our marketing and
distribution alliance with Becton Dickinson, we may not be able to execute our
business plan, which would have a material adverse effect on our business,
financial condition and results of operations. See also "--Company and Business
Risks--Required minimum payments under our keratome license agreement may exceed
our gross profits from sales of our keratome products."

         THE VISION CORRECTION INDUSTRY CURRENTLY CONSISTS OF A FEW ESTABLISHED
PROVIDERS WITH SIGNIFICANT MARKET SHARES AND WE MAY ENCOUNTER DIFFICULTIES
COMPETING IN THIS HIGHLY COMPETITIVE ENVIRONMENT.

         The vision correction industry is subject to intense, increasing
competition, and we do not know if we will be able to compete successfully
against our current and future competitors. Many of our competitors have
established products, distribution capabilities and customer service networks in
the U.S. marketplace, are substantially larger and have greater brand
recognition and greater financial and other resources than we do. Visx, the
historical industry leader for excimer laser system sales in the U.S., sold
laser systems that performed a significant majority of the laser vision
correction procedures performed in the U.S. in 1999 and 2000. Similarly, Bausch
& Lomb sold a significant majority of the keratomes used by refractive surgeons
in the U.S. in 1999 and 2000. In 2000, Alcon acquired Summit Autonomous Inc. The
merger resulted in a combined entity with enhanced market presence, technology
base and distribution capabilities and provided Alcon with a narrow beam laser
technology platform that will compete more directly with our precision beam
scanning microspot LaserScan LSX excimer laser system. In addition, as a result
of the acquisition, the combined entity will be able to sell narrow beam laser
systems under a royalty-free license to certain Visx patents without incurring
the expense and uncertainty associated with intellectual property litigation
with Visx. We anticipate that Alcon will leverage the sale of its laser systems
with its other ophthalmic products.

         MANY OF OUR COMPETITORS RECEIVED EARLIER REGULATORY APPROVALS THAN US
AND MAY HAVE A COMPETITIVE ADVANTAGE OVER US DUE TO THE SUBSEQUENT EXPANSION OF
THEIR REGULATORY APPROVALS AND THEIR SUBSTANTIAL EXPERIENCE IN THE U.S. MARKET.

         We received the FDA approval necessary for the commercial sale of our
LaserScan LSX excimer laser system in the U.S. in November 1999 and commercial
shipments to customers in the U.S. began in March 2000. Our direct competitors
include large corporations such as Visx and Alcon, each of whom received FDA
approval of excimer laser systems more than three years prior to our approval
and has substantial experience manufacturing, marketing and servicing laser
systems in the U.S. In addition to Visx and Alcon, Nidek and Bausch & Lomb have
also received FDA approval for their laser systems.

                                      19
<PAGE>

         In the U.S., a manufacturer of excimer laser vision correction systems
gains a competitive advantage by having its systems approved by the FDA for a
wider range of treatments. Initial FDA approvals of excimer laser vision
correction systems historically have been limited to PRK treatment of low to
moderate nearsightedness, with additional approvals for other and broader
treatments granted only as a result of subsequent FDA applications and clinical
trials. Our LaserScan LSX is currently approved only for the PRK treatment of
low to moderate nearsightedness (up to -6.0 diopters) without astigmatism. In
August 2000, we received FDA approval to operate our laser systems at a 200 Hz
pulse repetition rate, twice the originally approved rate. Currently, excimer
laser vision correction systems manufactured by Visx, Alcon, Bausch & Lomb and
Nidek have been approved for higher levels of nearsightedness than the LaserScan
LSX and are also approved for the treatment of nearsightedness with astigmatism
for which the LaserScan LSX currently does not have approval. The Visx and Alcon
excimer laser systems are also approved for the treatment of moderate
farsightedness.

         We have submitted a PMA supplement to the FDA for approval to utilize
LASIK for the treatment of nearsightedness with astigmatism and have responded
to FDA requests for additional patient data related to our submission. We
anticipate FDA approval of this application during the third quarter of 2001,
though we cannot ensure when the approval will be received. In addition, we
have submitted PMA supplements to the FDA to permit our laser systems sold to
customers in the U.S. to utilize LASIK to treat hyperopia, hyperopic
astigmatism and mixed astigmatism. FDA approval of these applications is
anticipated in the first half of 2002, though we cannot ensure when the
approval will be received. Our ability to sell our laser systems in the U.S.
may be severely impaired if the FDA does not give timely approval of our
application for our LaserScan LSX to treat nearsightedness with astigmatism,
our application to permit our laser systems sold to customers in the U.S. to
include our latest eye tracking technology, or our application to permit our
laser systems sold to customers in the U.S. to utilize LASIK to treat myopic
astigmatism, hyperopic astigmatism and mixed astigmatism.

         Alcon's Apex Plus and Ladarvision Excimer Laser Workstations, Visx's
Star S2 Excimer Laser System and Nidek's EC-5000 Excimer Laser System have
received FDA approval for the LASIK treatment of myopia (nearsightedness) with
or without astigmatism. The approvals for most of the systems are for the
correction of myopia in the range of 0 diopters to -14.0 diopters and myopia
with astigmatism generally in the range of -0.5 diopters to -5.0 diopters.
Bausch & Lomb's Technolas 217 excimer laser has also received FDA approval for
the treatment of myopia up to -7.0 diopters with up to -3.0 diopters of
astigmatism. These laser systems are currently the only laser systems
commercially available in the U.S. with FDA approval for use in LASIK. A
physician may decide, as part of the practice of medicine, to use a medical
device outside of its FDA-approved indications for an unapproved or
"off-label" use. Prior to these laser approvals, all LASIK procedures
performed in the U.S. with commercially available lasers were performed as the
practice of medicine. In September 2000, the FDA approved Alcon's Ladarvision
system for the correction using LASIK of farsightedness of up to +6.0 diopters
and an astigmatism range of up to 6.0 diopters. In October 2000, the FDA
approved Visx's Star S2 and S3 systems for the correction using PRK of
farsightedness of up to +5.0 diopters and an astigmatism range of up to 4.0
diopters. Competitors' receipt of LASIK-specific FDA regulatory approvals
could give them a significant competitive advantage that could impede our
ability to successfully sell our LaserScan LSX system in the U.S. or
discourage physicians from using our or other manufacturers' lasers off-label.
Our failure to successfully market our product could have a material adverse
effect on our business, financial condition and results of operations.

         All of our principal competitors in the keratome business, including
current market leader Bausch & Lomb, received FDA clearance prior to the
commercialization of our keratome products and have substantial experience
marketing their keratome products. The established market presence in the U.S.
of previously approved laser systems and keratome products, as well as the
entry of new competitors into the market upon receipt of new or expanded
regulatory approvals, could impede our ability to successfully introduce our
LaserScan LSX system in the U.S. and our keratome products worldwide and may
have a material adverse effect on our business, financial condition and
results of operations.
                                       20
<PAGE>

         WE DEPEND UPON OUR ABILITY TO ESTABLISH AND MAINTAIN STRATEGIC
RELATIONSHIPS.

         We believe that our ability to establish and maintain strategic
relationships will have a significant impact on our ability to meet our business
objectives. These strategic relationships are critical to our future success
because we believe that these relationships will help us to:

         o   extend the reach of our products to a larger number of refractive
             surgeons;
         o   develop and deploy new products;
         o   further enhance the LaserSight brand; and
         o   generate additional revenue.

         Entering into strategic relationships is complicated because some of
our current and future strategic partners may decide to compete with us in some
or all of our markets. In addition, we may not be able to establish
relationships with key participants in our industry if they have relationships
with our competitors, or if we have relationships with their competitors.
Moreover, some potential strategic partners have resisted, and may continue to
resist, working with us until our products and services have achieved widespread
market acceptance. Once we have established strategic relationships, we will
depend on our partners' ability to generate increased acceptance and use of our
products and services. To date, we have established only a limited number of
strategic relationships, and many of these relationships are in the early stages
of development. There can be no assurance as to the terms, timing or
consummation of any future strategic relationships. If we lose any of these
strategic relationships or fail to establish additional relationships, or if our
strategic relationships fail to benefit us as expected, we may not be able to
execute our business plan, and our business will suffer.

         BECAUSE THE SALE OF OUR PRODUCTS IS DEPENDENT ON THE CONTINUED MARKET
ACCEPTANCE OF LASER-BASED REFRACTIVE EYE SURGERY USING THE LASIK PROCEDURE, THE
LACK OF BROAD MARKET ACCEPTANCE WOULD HURT OUR BUSINESS.

         We believe that whether we achieve profitability and growth will
depend, in part, upon the continued acceptance of laser vision correction using
the LASIK procedure in the U.S. and other countries. We cannot be certain that
laser vision correction will continue to be accepted by either the refractive
surgeons or the public at large as an alternative to existing methods of
treating refractive vision disorders. The acceptance of laser vision correction
and, specifically, the LASIK procedure may be adversely affected by:

         o   possible concerns relating to safety and efficacy, including the
             predictability, stability and quality of results;
         o   the public's general resistance to surgery;
         o   the effectiveness and lower cost of alternative methods of
             correcting refractive vision disorders;
         o   the lack of long-term follow-up data;
         o   the possibility of unknown side effects;
         o   the lack of third-party reimbursement for the procedures;
         o   the cost of the procedure; and
         o   unfavorable publicity involving patient outcomes from the use of
             laser vision correction.

         Unfavorable side effects and potential complications that may result
from the use of laser vision correction systems manufactured by any manufacturer
may broadly affect market acceptance of laser-based vision correction surgery.
Potential patients may not distinguish between our precision beam scanning spot
technology and the laser technology incorporated by our competitors in their
laser systems, and customers may not differentiate laser systems and procedures
that have not received FDA approval from FDA-approved systems and procedures.
Any adverse consequences resulting from procedures performed with a competitor's
systems or an unapproved laser system could adversely affect consumer acceptance
of laser vision correction in general. In addition, because laser vision
correction is an elective procedure that is not typically covered by insurance

                                       21
<PAGE>

and that involves more significant immediate expense than eyeglasses or contact
lenses, adverse changes in the U.S. or international economy may cause consumers
to reassess their spending choices and to select lower-cost alternatives for
their vision correction needs. Any such shift in spending patterns could reduce
the volume of LASIK procedures performed that would, in turn, reduce our
revenues from per procedure fees and sales of single-use products such as our
UniShaper keratome and our UltraEdge keratome blades.

         The failure of laser vision correction to achieve continued market
acceptance could have a material adverse effect on our business prospects. Even
if laser vision correction achieves and sustains market acceptance, sales of our
keratome products could be adversely impacted if a laser procedure that does not
require the creation of a corneal flap were to emerge as the procedure of
choice.

         NEW PRODUCTS OR TECHNOLOGIES COULD ERODE DEMAND FOR OUR PRODUCTS OR
MAKE THEM OBSOLETE, AND OUR BUSINESS COULD BE HARMED IF WE CANNOT KEEP PACE WITH
ADVANCES IN TECHNOLOGY.

         In addition to competing with eyeglasses and contact lenses, excimer
laser vision correction competes or may compete with newer technologies such as
intraocular lenses, corneal rings and surgical techniques using different or
more advanced types of lasers. Two products that may become competitive within
the near term are implantable contact lenses, which are pending FDA approval,
and corneal rings, which have been approved by the FDA. Both of these products
require procedures with lens implants, and their ultimate market acceptance is
unknown at this time. To the extent that any of these or other new technologies
are perceived to be clinically superior or economically more attractive than
currently marketed excimer laser vision correction procedures or techniques,
they could erode demand for our excimer laser and keratome products, cause a
reduction in selling prices of such products or render such products obsolete.
In addition, if one or more competing technologies achieves broader market
acceptance or renders laser vision correction procedures obsolete, it would have
a material adverse effect on our business, financial condition and results of
operations.

         As is typical in the case of new and rapidly evolving industries, the
demand and market for recently introduced products and technologies is
uncertain, and we cannot be certain that our LaserScan LSX laser system,
UltraShaper durable keratome, UltraEdge keratome blades, UniShaper single-use
keratome or future new products and enhancements will be accepted in the
marketplace. In addition, announcements or the anticipation of announcements of
new products, whether for sale in the near future or at some later date, may
cause customers to defer purchasing our existing products.

         If we cannot adapt to changing technologies, our products may become
obsolete, and our business could suffer. Our success will depend, in part, on
our ability to continue to enhance our existing products, develop new technology
that addresses the increasingly sophisticated needs of our customers, license
leading technologies and respond to technological advances and emerging industry
standards and practices on a timely and cost-effective basis. The development of
our proprietary technology entails significant technical and business risks. We
may not be successful in using new technologies effectively or adapting our
proprietary technology to evolving customer requirements or emerging industry
standards.

COMPANY AND BUSINESS RISKS

         WE WILL BE REQUIRED TO SIGNIFICANTLY EXPAND OUR U.S. MANUFACTURING
OPERATIONS TO MEET OUR BUSINESS PLAN AND MUST COMPLY WITH STRINGENT REGULATION
OF OUR MANUFACTURING OPERATIONS.

         We manufacture our LaserScan LSX laser systems for sale in the U.S. at
our manufacturing facility in Winter Park, Florida, and continue to manufacture
our laser systems for sale in international markets at our manufacturing
facility in Costa Rica. Our U.S. personnel have limited experience manufacturing
laser systems. We cannot, therefore, assure you that we will not encounter
difficulties in increasing our production capacity for our laser systems at our
Florida facility, including problems involving production delays, quality
control or assurance, component supply and lack of qualified personnel. Any
products manufactured or distributed by us pursuant to FDA clearances or

                                       22
<PAGE>

approvals are subject to extensive regulation by the FDA, including
record-keeping requirements and reporting of adverse experience with the use of
the product. Our manufacturing facilities are subject to periodic inspection by
the FDA, certain state agencies and international regulatory agencies. We
require that our key suppliers comply with recognized standards as well as our
own quality standards, and we regularly test the components and sub-assemblies
supplied to us. Any failure by us or our suppliers to comply with applicable
regulatory requirements, including the FDA's quality systems/good manufacturing
practice (QSR/GMP) regulations, could cause production and distribution of our
products to be delayed or prohibited, either of which could have a material
adverse effect on our business, financial condition and results of operations.

         REQUIRED PER PROCEDURE FEES PAYABLE TO VISX UNDER OUR LICENSE AGREEMENT
MAY EXCEED PER PROCEDURE FEES COLLECTED BY US.

         In addition to the risk that our refractive lasers will not be accepted
in the marketplace, we are required to pay Visx a royalty for each procedure
performed in the U.S. using our refractive lasers. The required per procedure
fees we are required to pay to Visx may exceed the per procedure fees we are
able to charge and/or collect from refractive surgeons.

         REQUIRED MINIMUM PAYMENTS UNDER OUR KERATOME LICENSE AGREEMENT MAY
EXCEED OUR GROSS PROFITS FROM SALES OF OUR KERATOME PRODUCTS.

         We are required to make certain minimum payments to the licensor under
our keratome license agreement that was amended and restated on January 4, 2001.
This amendment replaced a January 18, 2000 amendment in its entirety. Under the
terms of the amendment we issued 730,552 shares of common stock to the
licensors, valued at approximately $1.1 million, in partial payment for
royalties during the term of the license. The term of the license was extended
three years until July 31, 2005. In addition, remaining minimum royalty payments
totaling approximately $5.2 million as of August 13, 2001 will be due in
quarterly installments through the term of the amendment. As a result of our
obligations under this license arrangement, the minimum royalty payments we are
required to make to the licensors may exceed our gross profits from sales of our
UniShaper and UltraShaper keratome products. The amendment eliminated a
restriction on us manufacturing, marketing and selling other keratomes, but the
sale of other keratomes will be included in the gross profit to be shared with
the licensors. The licensor's share of the gross profit, as defined in the
agreement, decreased from 50% to 10%.

         OUR FAILURE TO TIMELY OBTAIN OR EXPAND REGULATORY APPROVALS FOR OUR
PRODUCTS AND TO COMPLY WITH REGULATORY REQUIREMENTS COULD ADVERSELY AFFECT OUR
BUSINESS.

         Our excimer laser systems and keratome products are subject to strict
governmental regulations that materially affect our ability to manufacture and
market these products and directly impact our overall business prospects. FDA
regulations impose design and performance standards, labeling and reporting
requirements, and submission conditions in advance of marketing for all medical
laser products in the U.S. New product introductions, expanded treatment types
and levels for approved products, and significant design or manufacturing
modifications require a premarket clearance or approval by the FDA prior to
commercialization in the U.S. The FDA approval process, which is lengthy and
uncertain, requires supporting clinical studies and substantial commitments of
financial and management resources. Failure to obtain or maintain regulatory
approvals and clearances in the U.S. and other countries, or significant delays
in obtaining these approvals and clearances, could prevent us from marketing our
products for either approved or expanded indications or treatments, which could
substantially decrease our future revenues. Additionally, product and procedure
labeling and all forms of promotional activities are subject to examination by
the FDA, and current FDA enforcement policy prohibits the marketing by
manufacturers of approved medical devices for unapproved uses. Noncompliance
with these requirements may result in warning letters, fines, injunctions,
recall or seizure of products, suspension of manufacturing, denial or withdrawal
of PMAs, and criminal prosecution. Laser products marketed in foreign countries
are often subject to local laws governing health product development processes,
which may impose additional costs for overseas product development. Future
legislative or administrative requirements, in the U.S. or elsewhere, may
adversely affect our ability to obtain or retain regulatory approval for our

                                       23
<PAGE>

products. The failure to obtain approvals for new or additional uses on a timely
basis could have a material adverse effect on our business, financial condition
and results of operations.

         OUR BUSINESS DEPENDS ON OUR INTELLECTUAL PROPERTY RIGHTS, AND IF WE ARE
UNABLE TO PROTECT THEM, OUR COMPETITIVE POSITION MAY BE ADVERSELY AFFECTED.

         Our business plan is predicated on our proprietary systems and
technology, including our precision beam scanning microspot technology laser
systems. We protect our proprietary rights through a combination of patent,
trademark, trade secret and copyright law, confidentiality agreements and
technical measures. We generally enter into non-disclosure agreements with our
employees and consultants and limit access to our trade secrets and technology.
We cannot assure you that the steps we have taken will prevent misappropriation
of our intellectual property. Misappropriation of our intellectual property
would have a material adverse effect on our competitive position. In addition,
we may have to engage in litigation or other legal proceedings in the future to
enforce or protect our intellectual property rights or to defend against claims
of invalidity. These legal proceedings may consume considerable resources,
including management time and attention, which would be diverted from the
operation of our business, and the outcome of any such legal proceeding is
inherently uncertain.

         We are aware that certain competitors are developing products that may
potentially infringe patents owned or licensed exclusively by us. In order to
protect our rights in these patents, we may find it necessary to assert and
pursue infringement claims against such third parties. We could incur
substantial costs and diversion of management resources litigating such
infringement claims and we cannot assure you that we will be successful in
resolving such claims or that the resolution of any such dispute will be on
terms that are favorable to us. See "--Patent infringement allegations may
impair our ability to manufacture and market our products."

         PATENT INFRINGEMENT ALLEGATIONS MAY IMPAIR OUR ABILITY TO MANUFACTURE
AND MARKET OUR PRODUCTS.

         There are a number of U.S. and foreign patents covering methods and
apparatus for performing corneal surgery that we do not own or have the right to
use. If we were found to infringe a patent in a particular market, we and our
customers may be enjoined from manufacturing, marketing, selling and using the
infringing product in the market and may be liable for damages for any past
infringement of such rights. In order to continue using such rights, we would be
required to obtain a license, which may require us to make royalty, per
procedure or other fee payments. We cannot be certain if we or our customers
will be successful in securing licenses, or that if we obtain licenses, such
licenses will be available on acceptable terms. Alternatively, we might be
required to redesign the infringing aspects of these products. Any redesign
efforts that we undertake could be expensive and might require regulatory
review. Furthermore, the redesign efforts could delay the reintroduction of
these products into certain markets, or may be so significant as to be
impractical. If redesign efforts were impractical, we could be prevented from
manufacturing and selling the infringing products, which would have a material
adverse effect on our business, financial condition and results of operations.

         Litigation involving patents is common in our industry. While we do not
believe our laser systems or keratome products infringe any valid and
enforceable patents that we do not own or have a license to, we cannot assure
you that one or more of our other competitors or other persons will not assert
that our products infringe their intellectual property, or that we will not in
the future be deemed to infringe one or more patents owned by them or some other
party. We could incur substantial costs and diversion of management resources
defending any infringement claims. Furthermore, a party making a claim against
us could secure a judgment awarding substantial damages, as well as injunctive
or other equitable relief that could effectively block our ability to market one
or more of our products. In addition, we cannot assure you that licenses for any
intellectual property of third parties that might be required for our products
will be available on commercially reasonable terms, or at all.

                                       24
<PAGE>

         WE ARE SUBJECT TO CERTAIN RISKS ASSOCIATED WITH OUR INTERNATIONAL
SALES.

         Our international sales accounted for 69% and 45% of our total revenues
during the six months ended June 30, 2001 and year ended December 31, 2000,
respectively. In the future, we expect that sales to international accounts will
represent a lower percentage of our total sales as a result of our anticipated
additional regulatory approvals to market our LaserScan LSX laser system in the
U.S. and the expected commercial launch of our UltraShaper durable keratome in
the third quarter of 2001.  See "--Industry and Competitive Risks--We cannot
assure you that our keratome products will achieve market acceptance."

         International sales of our products may be limited or disrupted by:

         o   the imposition of government controls;
         o   export license requirements;
         o   economic or political instability;
         o   trade restrictions;
         o   difficulties in obtaining or maintaining export licenses;
         o   changes in tariffs; and
         o   difficulties in staffing and managing international operations.

         Our sales have historically been and are expected to continue to be
denominated in U.S. dollars. The European Economic Union's conversion to a
common currency, the euro, is not expected to have a material impact on our
business. However, due to our significant export sales, we are subject to
exchange rate fluctuations in the U.S. dollar, which could increase the
effective price in local currencies of our products. This could result in
reduced sales, longer payment cycles and greater difficulty in collecting
receivables relating to our international sales.

         OUR SUPPLY OF CERTAIN CRITICAL COMPONENTS AND SYSTEMS MAY BE
INTERRUPTED BECAUSE OF OUR RELIANCE ON A LIMITED NUMBER OF SUPPLIERS.

         We currently purchase certain components used in the production,
operation and maintenance of our laser systems and keratome products from a
limited number of suppliers, and certain key components are provided by a single
vendor. For example, all of our keratome blades are currently manufactured
exclusively by Becton Dickinson and the majority of our UltraShaper components
are manufactured exclusively by Owens Industries pursuant to our agreement with
them. We do not have long-term contracts with providers of some key laser system
components, including TUI Lasertechnik und Laserintegration GmbH, which
currently is a single source supplier for the laser heads used in our LaserScan
LSX excimer laser system. Currently, SensoMotoric Instruments GmbH, Teltow,
Germany, is a single source supplier for the eye tracker boards used in the
LaserScan LSX. Any interruption in the supply of critical laser or keratome
components could have a material adverse effect on our business, financial
condition and results of operations. If any of our key suppliers ceases
providing us with products of acceptable quality and quantity at a competitive
price and in a timely fashion, we would have to locate and contract with a
substitute supplier and, in some cases, such substitute supplier would need to
be qualified by the FDA. If substitute suppliers cannot be located and qualified
in a timely manner or could not provide required products on commercially
reasonable terms, it would have a material adverse effect on our business,
financial condition and results of operations.

         UNLAWFUL TAMPERING OF OUR SYSTEM CONFIGURATIONS COULD RESULT IN REDUCED
REVENUES AND ADDITIONAL EXPENSES.

         We include a procedure counting mechanism on LaserScan LSX lasers
manufactured for sale and use in the U.S. Users of our LaserScan LSX excimer
laser system could tamper with the software or hardware configuration of the
system so as to alter or eliminate the procedure counting mechanism that
facilitates the collection of per procedure fees. Unauthorized tampering with
our procedure counting mechanism by users could result in us being required to

                                       25
<PAGE>

pay per procedure fees to Visx that we were not able to collect from users. If
we are unable to prevent such tampering, our license agreement with Visx could
be terminated after all applicable notice and cure periods have expired.

         THE LOSS OF KEY PERSONNEL COULD ADVERSELY AFFECT OUR BUSINESS.

         Our ability to maintain our competitive position depends in part upon
the continued contributions of our executive officers and other key employees,
especially Michael R. Farris, our president and chief executive officer. A loss
of one or more such officers or key employees could have a material adverse
effect on our business. We do not carry "key person" life insurance on any
officer or key employee.

         As we commercially launch our laser system and keratome products in the
U.S., we will need to continue to implement and expand our operational, sales
and marketing, financial and management resources and controls. While to date we
have not experienced problems recruiting or retaining the personnel necessary to
expand our business, we cannot assure you that we will not have such problems in
the future. Our recent layoff may have a negative impact on our ability to
attract and retain personnel.  If we fail to attract and retain qualified
individuals for necessary positions, and if we are unable to effectively manage
growth in our domestic or international operations, it could have a material
adverse effect on our business, financial condition and results of operations.

         INADEQUACY OR UNAVAILABILITY OF INSURANCE MAY EXPOSE US TO SUBSTANTIAL
PRODUCT LIABILITY CLAIMS.

         Our business exposes us to potential product liability risks and
possible adverse publicity that are inherent in the development, testing,
manufacture, marketing and sale of medical devices for human use. These risks
increase with respect to our products that receive regulatory approval for
commercialization. We have agreed in the past, and we will likely agree in the
future, to indemnify certain medical institutions and personnel who conduct and
participate in our clinical studies. While we maintain product liability
insurance, we cannot be certain that any such liability will be covered by our
insurance or that damages will not exceed the limits of our coverage. Even if a
claim is covered by insurance, the costs of defending a product liability,
malpractice, negligence or other action, and the assessment of damages in excess
of insurance coverage in the event of a successful product liability claim,
could have a material adverse effect on our business, financial condition and
results of operations. Further, product liability insurance may not continue to
be available, either at existing or increased levels of coverage, on
commercially reasonable terms.

FINANCIAL AND LIQUIDITY RISKS

         WE HAVE EXPERIENCED SIGNIFICANT LOSSES AND OPERATING CASH FLOW DEFICITS
AND WE EXPECT THAT OPERATING CASH FLOW DEFICITS WILL CONTINUE THROUGH AT LEAST
THE REMAINDER OF 2001.

         We experienced significant net losses and deficits in cash flow from
operations for the years ended December 31, 2000 and 1999 and the six months
ended June 30, 2001, as set forth in the following table. We cannot be certain
that we will be able to achieve or sustain profitability or positive operating
cash flow in the future.

<TABLE>
<CAPTION>
                                           Year Ended December 31,                     Six Months Ended
                                           ----------------------                      ----------------
                                          1999                       2000                 June 30, 2001
                                          ----                       ----                 -------------
<S>                                   <C>                       <C>                       <C>
Net loss...................           $14.4 million             $21.4 million             $11.2 million
Deficit in cash flow from
   operations..............           $11.7 million             $15.7 million             $12.6 million

</TABLE>

         As of June 30, 2001, we had an accumulated deficit of $70.8 million.

                                       26
<PAGE>

         IF OUR UNCOLLECTIBLE RECEIVABLES EXCEED OUR RESERVES WE WILL INCUR
ADDITIONAL UNANTICIPATED EXPENSES, AND WE MAY EXPERIENCE DIFFICULTY COLLECTING
RESTRUCTURED RECEIVABLES WITH EXTENDED PAYMENT TERMS.

         Although we monitor the status of our receivables and maintain a
reserve for estimated losses, we cannot be certain that our reserves for
estimated losses, which were approximately $5.0 million at June 30, 2001, will
be sufficient to cover the amount of our actual write-offs over time. At June
30, 2001, our net trade accounts and notes receivable totaled approximately
$15.5 million, and accrued commissions, the payment of which generally depends
on the collection of such net trade accounts and notes receivable, totaled
approximately $2.3 million. Actual write-offs that exceed amounts reserved could
have a material adverse effect on our consolidated financial condition and
results of operations. The amount of any loss that we may have to recognize in
connection with our inability to collect receivables is principally dependent on
our customers' ongoing financial condition, their ability to generate revenues
from our laser systems, and our ability to obtain and enforce legal judgments
against delinquent customers.

         Our ability to evaluate the financial condition and revenue-generating
ability of our prospective customers located outside of the U.S., and our
ability to obtain and enforce legal judgments against customers located outside
of the U.S., is generally more limited than for our customers located in the
U.S. Our agreements with our international customers typically provide that the
contracts are governed by Florida law. We have not determined whether or to what
extent courts or administrative agencies located in foreign countries would
enforce our right to collect such receivables or to recover laser systems from
customers in the event of a customer's payment default. When a customer is not
paying according to established terms, we attempt to communicate and understand
the underlying causes and work with the customer to resolve any issues we can
control or influence. In most cases, we have been able to resolve the customer's
issues and continue to collect our receivable, either on the original schedule
or under restructured terms. If such issues are not resolved, we evaluate our
legal and other alternatives based on existing facts and circumstances. In most
such cases, we have concluded that the account should be written off as
uncollectible.

         At June 30, 2001, we had extended the original payment terms of laser
customer accounts totaling approximately $1.3 million by periods ranging from 12
to 60 months. Such restructured receivables represent approximately 6.4% of our
gross receivables as of that date. Our liquidity and operating cash flow would
be adversely affected if additional extensions become necessary in the future.
In addition, it would be more difficult to collect laser system receivables if
the payment schedule extends beyond the expected or actual economic life of the
system, which we estimate to be approximately five to seven years. To date, we
do not believe any payment schedule extends beyond the economic life of the
applicable laser system.

         WE COULD REQUIRE ADDITIONAL FINANCING, WHICH MIGHT NOT BE AVAILABLE IF
WE NEED IT.

         During the six months ended June 30, 2001 and year ended December 31,
2000, we experienced deficits in cash flow from operations of $12.5 million and
$15.7 million, respectively. In July 2001, we completed a $3.0 million placement
of series F convertible participating preferred stock. An additional amount up
to $4.0 million may be raised before the end of the year if, on or prior to
October 1, 2001, we receive written notice from the FDA that our LaserScan LSX
has been approved or is approvable to treat myopic astigmatism. In that case, if
the three-day volume weighted average price of our common stock exceeds $2.75,
we may elect, during the 10-day period following the FDA approval, to sell
800,000 shares of our series G convertible participating preferred stock to the
same investors. The per share purchase price for the series G preferred stock
will be $2.50 (resulting in a $2.0 million investment in series G preferred
stock). If we receive the approval but do not elect to sell our series G
preferred stock as described above, the investors, for a period of 30 days
following the expiration of our election period, may elect to purchase shares of
series G preferred stock at a per share purchase price of 85% of the ten-day
volume weighted average price, limited to an aggregate purchase price of $4.0
million. We are exploring opportunities for additional equity financing through
a private placement of our common stock. If we experience unanticipated delays
in obtaining FDA approval for the treatment of astigmatism or the commercial
release of our UltraShaper durable keratome or AstraMax diagnostic workstation,
we will be required to seek additional debt or equity financiang during the next
12 months. There can be no assurance that the assumptions underlying our

                                       27
<PAGE>

business plan will be met or that additional financing will not be needed or
that financing, if needed, would be available. Our belief regarding future
working capital requirements is based on various factors and assumptions
including: the successful reduction of a significant amount of expenses
currently being implemented, the uncertain timing of astigmatism and other
supplemental FDA approvals for our LaserScan LSX excimer laser system, which
could continue to negatively impact our sales during 2001, potential growth in
laser sales after receipt of further FDA approvals, increases in accounts
receivable and inventory purchases when sales increase, the potential for
borrowing under our revolving credit facility, the uncertain impact of the
market introduction of our UltraShaper durable keratomes, commercial acceptance
of our UltraEdge keratome blades and UniShaper single-use keratomes, which we
believe is partially dependent upon the successful introduction of the
UltraShaper, the anticipated timely collection of receivables, and the absence
of unanticipated product development and marketing costs. See "--Industry and
Competitive Risks--We cannot assure you that our keratome products will achieve
market acceptance" and "--We cannot assure you that our LaserScan LSX laser
system will achieve market acceptance in the U.S., and our business model for
selling our laser system in the U.S. is new and unproven." These factors and
assumptions are subject to certain contingencies and uncertainties, some of
which are beyond our control. If we do not collect a material portion of current
receivables in a timely manner, or experience less market demand for our
products than we anticipate, our liquidity could be materially and adversely
affected.

         On March 12, 2001, we established a $3.0 million term loan and $10.0
million revolving credit facility with Heller. We borrowed $3.0 million under
the term loan at a rate per annum equal to two and one-half percent (2 1/2%)
above the prime rate. Interest is payable monthly and the loan must be repaid on
March 12, 2003. Under the credit facility, we have the option to borrow amounts
at a rate per annum equal to one and one-quarter percent (1 1/4%) above the
prime rate for short-term working capital needs or such other purposes as may be
approved by Heller. Borrowings are limited to 85% of qualified accounts
receivable related to U.S. sales. Borrowings under the loans are secured by
substantially all of the Company's assets. The term loan and credit facility
require us to meet certain covenants, including the maintenance of a minimum net
worth. The terms of the loans extend to March 12, 2003. In addition to the costs
and fees associated with the transaction, we issued to Heller a warrant to
purchase 243,750 shares of common stock at an exercise price of $3.15 per share.
The warrant expires on March 12, 2004. At August 13, 2001, we had no borrowings
under the revolving credit facility.

         We may seek additional equity financing in the future to implement our
business plan or any changes thereto in response to future developments or
unanticipated contingencies. Other than the $10.0 million revolving credit
facility with Heller and the possible series G preferred stock issuance
described above, we currently do not have any commitments for additional
financing. We cannot be certain that additional financing will be available in
the future to the extent required or that, if available, it will be on
commercially acceptable terms. If we raise additional funds by issuing equity or
convertible debt securities, the terms of the new securities could have rights,
preferences and privileges senior to those of our common stock. If we raise
additional funds through debt financing, the terms of the debt could require a
substantial portion of our cash flow from operations to be dedicated to the
payment of principal and interest and may render us more vulnerable to
competitive pressures and economic downturns. If we are not able to obtain
financing necessary to meet our working capital needs, it could have a material
adverse effect on our financial condition and results of operations.

COMMON STOCK RISKS

         VARIATIONS IN OUR SALES AND OPERATING RESULTS MAY CAUSE OUR STOCK PRICE
TO FLUCTUATE.

         Our operating results have fluctuated in the past, and may continue to
fluctuate in the future, as a result of a variety of factors, many of which are
outside of our control. For example, historically a significant portion of our
laser system orders for a particular quarter have been received and shipped near
the end of the quarter. As a result, our operating results for any quarter often
depend on the timing of the receipt of orders and the subsequent shipment of our
laser systems. Other factors that may cause our operating results to fluctuate
include:

                                       28
<PAGE>

         o   timing of regulatory approvals and the introduction or delays in
             shipment of new products;
         o   reductions, cancellations or fulfillment of major orders;
         o   the addition or loss of significant customers;
         o   the relative mix of our business;
         o   changes in pricing by us or our competitors;
         o   costs related to expansion of our business; and
         o   increased competition.

         As a result of these fluctuations, we believe that period-to-period
comparisons of our operating results cannot be relied upon as indicators of
future performance. In some quarters our operating results may fall below the
expectations of securities analysts and investors due to any of the factors
described above or other uncertainties.

         THE MARKET PRICE OF OUR COMMON STOCK MAY CONTINUE TO EXPERIENCE EXTREME
FLUCTUATIONS DUE TO MARKET CONDITIONS THAT ARE UNRELATED TO OUR OPERATING
PERFORMANCE.

         The stock market, and in particular the securities of technology
companies like us, could experience extreme price and volume fluctuations
unrelated to our operating performance. Our stock price has historically been
volatile. Factors such as announcements of technological innovations or new
products by us or our competitors, changes in domestic or foreign governmental
regulations or regulatory approval processes, developments or disputes relating
to patent or proprietary rights, public concern as to the safety and efficacy of
refractive vision correction procedures, and changes in reports and
recommendations of securities analysts, have and may continue to have a
significant impact on the market price of our common stock.

         THE SIGNIFICANT NUMBER OF SHARES ELIGIBLE FOR FUTURE SALE AND DILUTIVE
STOCK ISSUANCES MAY ADVERSELY AFFECT OUR STOCK PRICE.

         Sales, or the possibility of sales, of substantial amounts of our
common stock in the public market could adversely affect the market price of our
common stock. Substantially all of our 26,437,895 shares of common stock
outstanding at August 13, 2001 were freely tradable without restriction or
further registration under the Securities Act of 1933, except to the extent such
shares are held by "affiliates" as that term is defined in Rule 144 under the
Securities Act or subject only to the satisfaction of a prospectus delivery
requirement.

         Shares of common stock that we may issue in the future in connection
with acquisitions or financings or pursuant to outstanding warrants or
agreements could also adversely affect the market price of our common stock and
cause significant dilution in our earnings per share and net book value per
share. We may be required to issue more than 7,800,000 additional shares of
common stock upon the conversion of outstanding preferred stock, the exercise of
outstanding warrants and stock options, and the satisfaction of certain
contingent contractual obligations.

         The anti-dilution provisions of certain of our existing securities and
obligations require us to issue additional shares if we issue shares of common
stock below specified price levels. If a future share issuance triggers these
adjustments, the beneficiaries of such provisions effectively receive some
protection from declines in the market price of our common stock, while our
other stockholders incur additional dilution of their ownership interest. We may
include similar anti-dilution provisions in securities issued in connection with
future financings.

                                       29
<PAGE>

         ANTI-TAKEOVER PROVISIONS UNDER DELAWARE LAW AND IN OUR CERTIFICATE OF
INCORPORATION, BY-LAWS AND STOCKHOLDER RIGHTS PLAN MAY MAKE AN ACQUISITION OF
LASERSIGHT MORE DIFFICULT AND COULD PREVENT YOU FROM RECEIVING A PREMIUM OVER
THE MARKET PRICE OF OUR STOCK.

         Certain provisions of our certificate of incorporation, by-laws,
stockholder rights plan and Delaware law could delay or frustrate the removal of
incumbent directors, discourage potential acquisition proposals and delay, defer
or prevent a change in control of us, even if such events could be beneficial,
in the short term, to the economic interests of our stockholders. For example,
our certificate of incorporation allows us to issue preferred stock with rights
senior to those of the common stock without stockholder action, and our by-laws
require advance notice of director nominations or other proposals by
stockholders. We also are subject to provisions of Delaware corporation law that
prohibit a publicly-held Delaware corporation from engaging in a broad range of
business combinations with a person who, together with affiliates and
associates, owns 15% or more of the corporation's common stock (an interested
stockholder) for three years after the person became an interested stockholder,
unless the business combination is approved in a prescribed manner. We also have
adopted a stockholder rights agreement, or "poison pill," and declared a
dividend distribution of one preferred share purchase right for each share of
common stock. The rights would cause substantial dilution to a person or group
that attempts to acquire 15% or more of our common stock on terms not approved
by our board of directors.

ACQUISITION RISKS

         PAST AND POSSIBLE FUTURE ACQUISITIONS THAT ARE NOT SUCCESSFULLY
INTEGRATED WITH OUR EXISTING OPERATIONS MAY ADVERSELY AFFECT OUR BUSINESS.

         We have made several significant acquisitions since 1994, and we may in
the future selectively pursue strategic acquisitions of, investments in or enter
into joint ventures or other strategic alliances with companies whose business
or technology complement our business. We may not be able to identify suitable
candidates to acquire or enter into joint ventures or other arrangements with
entities, and we may not be able to obtain financing on satisfactory terms for
such activities. In addition, we could have difficulty assimilating the
personnel, technology and operations of any acquired companies, which could
prevent us from realizing expected synergies, and may incur unanticipated
liabilities and contingencies. This could disrupt our ongoing business and
distract our management and other resources.

         AMORTIZATION AND CHARGES RELATING TO OUR SIGNIFICANT INTANGIBLE ASSETS
COULD ADVERSELY AFFECT OUR STOCK PRICE AND REPORTED NET INCOME OR LOSS.

         Of our total assets at June 30, 2001, approximately $8.6 million, or
19%, were goodwill or other intangible assets. Any reduction in net income or
increase in net loss resulting from the amortization of goodwill and other
intangible assets resulting from future acquisitions by us may have an adverse
impact upon the market price of our common stock. In addition, in the event of a
sale of LaserSight or our assets, we cannot be certain that the value of such
intangible assets would be recovered.

         In accordance with SFAS 121, we review intangible assets for impairment
whenever events or changes in circumstances, including a history of operating or
cash flow losses, indicate that the carrying amount of an asset may not be
recoverable. If we determine that an intangible asset is impaired, a non-cash
impairment charge would be recognized. We continue to assess the current results
and future prospects of TFG, our subsidiary that provides health care and vision
care consulting services, in view of the substantial reduction in the
subsidiary's operating results in 1997. Though TFG's operating results improved
in 1998 when compared to 1997, operating losses similar to those incurred during
the first half of 1998 continued during 1999. Since 1999, TFG's operations have
reflected financial improvement. If TFG is unsuccessful in continuing to improve
its financial performance, some or all of the carrying amount of goodwill
recorded, $3.1 million at June 30, 2001, may be subject to an impairment
adjustment.  See "Management's Discussion and Analysis of Financial Condition
and Results of Operations--New Accounting Pronouncements."

                                       30
<PAGE>

OTHER RISKS

         The risks described above are not the only risks facing LaserSight.
There may be additional risks and uncertainties not presently known to us or
that we have deemed immaterial which could also negatively impact our business
operations. If any of the foregoing risks actually occur, it could have a
material adverse effect on our business, financial condition and results of
operations. In that event, the trading price of our common stock could decline,
and you may lose all or part of your investment.


ITEM 3.           QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

         We believe that our exposure to market risk for changes in interest and
currency rates is not significant. Our investments are limited to highly liquid
instruments generally with maturities of three months or less. At June 30, 2001,
we had approximately $3.7 million of short-term investments classified as cash
and equivalents. All of our transactions with international customers and
suppliers are denominated in U.S. dollars.

                           PART II - OTHER INFORMATION

ITEM 1            LEGAL PROCEEDINGS

                        Certain legal proceedings against LaserSight are
                  described in Item 3 (Legal Proceedings) of LaserSight's Form
                  10-K for the year ended December 31, 2000.

                           Former MRF, Inc. Shareholder. On May 14, 2001, a
                           ----------------------------
                  motion for summary judgment was granted in favor of Michael R.
                  Farris in connection with a lawsuit was filed on November 12,
                  1999 in the U.S. District Court for the Eastern District of
                  Missouri on behalf of a former shareholder of MRF, Inc. (the
                  "Subsidiary"), a wholly-owned subsidiary of LaserSight. The
                  lawsuit names Mr. Farris, LaserSight's Chief Executive
                  Officer, as the sole defendant and alleges fraud and breach of
                  fiduciary duty by Mr. Farris in connection with the redemption
                  by the Subsidiary of the former shareholder's capital stock in
                  the Subsidiary. At the time of the redemption, which
                  redemption occurred prior to LaserSight's acquisition of the
                  Subsidiary, Mr. Farris was the President and Chief Executive
                  Officer of the Subsidiary. LaserSight's Board of Directors
                  authorized LaserSight to retain and, to the fullest extent
                  permitted by the Delaware General Corporation Law, pay the
                  fees of counsel to defend Mr. Farris, the Subsidiary and
                  LaserSight in the litigation so long as a court has not
                  determined that Mr. Farris failed to act in good faith and in
                  a manner Mr. Farris reasonably believed to be in the best
                  interest of the Subsidiary at the time of the redemption. The
                  plaintiff has appealed the U.S. District Court's order
                  granting summary judgment in favor of Mr. Farris, and the
                  plaintiff is expected to file his appellate brief with the
                  court of appeals in late August 2001.

                           Visx. On May 25, 2001 LaserSight settled the patent
                           ----
                  infringement action filed by Visx Incorporated ("Visx")
                  against LaserSight in November 1999 in the United States
                  District Court for the District of Delaware. In connection
                  with the resolution of this litigation LaserSight and Visx
                  entered into a Settlement and License Agreement pursuant to
                  which LaserSight received a license to patents held by Visx
                  that relate to refractive excimer lasers, including United
                  States Patents Nos. 4,718,418 and B1 5,108,388 and has agreed
                  to pay a royalty for each procedure performed in the United
                  States using a LaserSight refractive laser. As part of the
                  agreement, Visx purchased a fully paid up license to U.S.
                  Patent No. 4,784,135 (the Blum Patent). Under the Settlement
                  and License Agreement, all economic terms and conditions are
                  confidential. The parties filed a stipulated order dismissing
                  the patent infringement action on June 1, 2001.

                                       31
<PAGE>

                           Distributors. On July 3, 2001, LaserSight received a
                           ------------
                  letter from attorneys representing three entities that
                  previously served as distributors for LaserSight's excimer
                  laser system in the U.S., Bal-Tech Medical, Inc., Sun Medical,
                  Inc. and Surgical Lasers, Inc. LaserSight terminated its
                  distribution agreement with each of these distributors in
                  February 2001 when LaserSight implemented a direct sales
                  force. The letter made various claims related to LaserSight's
                  termination of the distribution arrangements including breach
                  of contract, breach of the covenant of good faith and fair
                  dealing, tortious interference with business relationships,
                  fraudulent inducement, intentional misrepresentation,
                  conversion, civil theft and unjust enrichment. As of the date
                  hereof, no lawsuits have been filed on behalf of LaserSight or
                  the distributors.

ITEM 2            CHANGES IN SECURITIES

                  Not applicable.

ITEM 3            DEFAULTS UPON SENIOR SECURITIES

                  Not applicable.

ITEM 4            SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

                  Not applicable

ITEM 5            OTHER INFORMATION

                  Not applicable.

ITEM 6            EXHIBITS AND REPORTS ON FORM 8-K

                  a)       Exhibits


                                INDEX TO EXHIBITS

   Exhibit
    Number                                      Description
    ------            ----------------------------------------------------------

     2.1          See Exhibits 10.1, 10.2, 10.6, 10.7, 10.15, 10.20, 10.23,
                  10.24, 10.27, 10.28, 10.48 and 10.55.

     3.1          Certificate  of  Incorporation,  as amended  (incorporated  by
                  reference to Exhibit 1 of Form 8-A/A (Amendment No. 6) filed
                  by the Company on August 10, 2001*).

     3.2          Bylaws,  as amended  (filed as Exhibit 3.2 to the  Company's
                  Form 8-K filed on December  20, 1999*).

     3.3          Rights Agreement, dated as of July 2, 1998, between LaserSight
                  Incorporated and American Stock Transfer & Trust Company, as
                  Rights Agent, which includes (I) as Exhibit A thereto the form
                  of Certificate of Designation of the Series E Junior
                  Participating Preferred Stock, (ii) as Exhibit B thereto the
                  form of Right Certificate (separate certificates for the
                  Rights will not be issued until after the Distribution Date)
                  and (iii) as Exhibit C thereto the Summary of Stockholder
                  Rights Agreement (incorporated by reference to Exhibit 99.1 to
                  the Form 8-K filed by the Company on July 8, 1998*).

                                      32
<PAGE>

     3.4          First Amendment to Rights Agreement, dated as of March 22,
                  1999, between LaserSight Incorporated and American Stock
                  Transfer & Trust Company, as Rights Agent (incorporated by
                  reference to Exhibit 2 to Form 8-A/A filed by the Company on
                  March 29, 1999*).

     3.5          Second Amendment to Rights Agreement, dated as of January 28,
                  2000, between LaserSight Incorporated and American Stock
                  Transfer & Trust Company, as Rights Agent (incorporated by
                  reference to Exhibit 99.6 to Form 8-K filed by the Company on
                  February 8, 2000*).

     3.6          Third Amendment to Rights Agreement, dated as of June 29,
                  2001, between LaserSight Incorporated and American Stock
                  Transfer & Trust Company, as Rights Agent (incorporated by
                  reference to Exhibit 99.5 to Form 8-K filed by the Company on
                  July 18, 2001*).

     4.1          See Exhibits 3.1, 3.2, 3.3, 3.4, 3.5, 3.6, 10.17, 10.21,
                  10.26, 10.31, 10.32, 10.33, 10.40, 10.42, 10.43, 10.44, 10.45,
                  10.46, 10.47, 10.51, 10.52, 10.53, 10.54, 10.56, 10.57, 10.59,
                  10.60, 10.63, 10.64 and 10.65.

    10.1          Agreement for Purchase and Sale of Stock by and among
                  LaserSight Centers Incorporated, its stockholders and
                  LaserSight Incorporated dated January 15, 1993 (filed as
                  Exhibit 2 to the Company's Form 8-K/A filed on January 25,
                  1993*).

    10.2          Amendment to Agreement for Purchase and Sale of Stock by and
                  among LaserSight Centers Incorporated, its stockholders, and
                  LaserSight Incorporated dated April 5, 1993 (filed as Exhibit
                  2 to the Company's Form 8-K/A filed on April 19, 1993*).

    10.3          Royalty Agreement by and between LaserSight Centers
                  Incorporated and LaserSight Partners dated January 15, 1993
                  (filed as Exhibit 10.5 to the Company's Form 10-K for the year
                  ended December 31, 1995*).

    10.4          Exchange Agreement dated January 25, 1993 between LaserSight
                  Centers Incorporated and Laser Partners (filed as Exhibit 10.6
                  to the Company's Form 10-K for the year ended December 31,
                  1995*).

    10.5          Stipulation and Agreement of Compromise, Settlement and
                  Release dated April 18, 1995 among James Gossin, Francis E.
                  O'Donnell, Jr., J.T. Lin, Wen S. Dai, Emanuela
                  Dobrin-Charlton, C.H. Huang, W. Douglas Hajjar, and LaserSight
                  Incorporated (filed as Exhibit 10.7 to the Company's Form 10-K
                  for the year ended December 31, 1995*).

    10.6          Agreement for Purchase and Sale of Stock dated December 31,
                  1993, among LaserSight Incorporated, MRF, Inc., and Michael R.
                  Farris (filed as Exhibit 2 to the Company's Form 8-K filed on
                  December 31, 1993*).

    10.7          First Amendment to Agreement for Purchase and Sale of Stock by
                  and among MRF, Inc., Michael R. Farris and LaserSight
                  Incorporated dated December 28, 1995 (filed as Exhibit 10.9 to
                  the Company's Form 10-K for the year ended December 31,
                  1995*).

    10.8          LaserSight Incorporated 1995 Stock Option Plan (filed as
                  Exhibit 10.5 to the Company's Form 10-Q for the quarter ended
                  September 30, 1995*).

    10.9          Modified Promissory Note between LaserSight Incorporated,
                  EuroPacific Securities Services, GmbH and Co. KG and Wolf
                  Wiese (filed as Exhibit 10.6 to the Company's Form 10-Q for
                  the quarter ended September 30, 1995*).

                                       33
<PAGE>

    10.10         Patent License Agreement dated December 21, 1995 by and
                  between Francis E. O'Donnell, Jr. and LaserSight Centers, Inc.
                  (filed as Exhibit 10.21 to the Company's Form 10-K for the
                  year ended December 31, 1995*).

    10.11         LaserSight Incorporated Amended and Restated 1996 Equity
                  Incentive Plan (filed as Exhibit 10.11 to the Company's Form
                  10-Q filed on November 14, 2000*).

    10.12         LaserSight Incorporated Amended and Restated Non-Employee
                  Directors Stock Option Plan (filed as Exhibit 10.12 to the
                  Company's Form 10-Q filed on November 14, 2000*).

    10.13         Agreement dated January 1, 1997, between International
                  Business Machines Corporation and LaserSight Incorporated
                  (filed as Exhibit 10.37 to the Company's Form 10-K for the
                  year ended December 31, 1996*).

    10.14         Addendum dated March 7, 1997 to Agreement between
                  International Business Machines Corporation and LaserSight
                  Incorporated (filed as Exhibit 10.38 to the Company's Form
                  10-K for the year ended December 31, 1996*).

    10.15         Second Amendment to Agreement for Purchase and Sale of Stock
                  by and among LaserSight Centers Incorporated, its stockholders
                  and LaserSight Incorporated dated March 14, 1997 (filed as
                  Exhibit 99.1 to the Company's Form 8-K filed on March 27,
                  1997*).

    10.16         Amendment to Royalty Agreement by and between LaserSight
                  Centers Incorporated, Laser Partners and LaserSight
                  Incorporated dated March 14, 1997 (filed as Exhibit 99.2 to
                  the Company"  Form 8-K filed on March 27, 1997*).

    10.17         Warrant to purchase 500,000 shares of common stock dated
                  March 31, 1997 by and between LaserSight Incorporated and
                  Foothill Capital Corporation (filed as Exhibit 10.44 to the
                  Company's Form 10-Q filed on August 14, 1997*).

    10.18         License Agreement dated May 20, 1997 by and between Visx
                  Incorporated and LaserSight Incorporated (filed as Exhibit
                  10.45 to the Company's Form 10-Q filed on August 14, 1997*).

    10.19         Patent Purchase Agreement dated July 15, 1997 by and between
                  LaserSight Incorporated and Frederic B. Kremer, M.D. filed as
                  Exhibit 2.(I) to the Company's Form 8-K filed on August 13,
                  1997*).

    10.20         Agreement and Plan of Merger dated July 15, 1997 by and among
                  LaserSight Incorporated, Photomed Acquisition, Inc., Photomed,
                  Inc., Frederic B. Kremer, M.D., Linda Kremer, Robert Sataloff,
                  Trustee for Alan Stewart Kremer and Robert Sataloff, Trustee
                  for Mark Adam Kremer (filed as Exhibit 2.(ii) to the Company's
                  Form 8-K filed on August 13, 1997*).

    10.21         Warrant to purchase 750,000 shares of common stock dated
                  August 29, 1997 by and between LaserSight Incorporated and
                  purchasers of Series B Convertible Participating Preferred
                  Stock of LaserSight Incorporated (filed as Exhibit 10.39 to
                  the Company's Form 10-Q filed on November 14, 1997*).

    10.22         Independent Contractor Agreement by and between Byron Santos,
                  M.D. and LaserSight Technologies, Inc. (filed as Exhibit
                  10.42 to the Company's Form 10-Q filed on November 14, 1997*).

                                      34
<PAGE>

    10.23         Stock Purchase Agreement, dated December 30, 1997, by and
                  among LaserSight Incorporated, LSI Acquisition, Inc.,  MEC
                  Health Care, Inc. and Vision Twenty-One, Inc. (filed as
                  Exhibit 2.(I) to the Company's Form 8-K filed on January 14,
                  1998*).

    10.24         Stock Distribution Agreement, dated December 30, 1997, by and
                  among LaserSight Incorporated, LSI Acquisition, Inc., MEC
                  Health Care, Inc. and Vision Twenty-One, Inc. (filed as
                  Exhibit 2.(ii) to the Company's Form 8-K filed on January 14,
                  1998*).

    10.25         Agreement dated April 1, 1992 between International Business
                  Machines Corporation and LaserSight Incorporated (filed as
                  Exhibit 10.1 on Form 10-K for the year ended December 31,
                  1995*).

    10.26         Securities Purchase Agreement, dated June 5, 1998, by and
                  between LaserSight Incorporated and TLC The Laser Center, Inc.
                  (filed as Exhibit 99.1 to the Company's Form 8-K filed on
                  June 25, 1998*).

    10.27         Letter Agreement dated September 11, 1998, amending the
                  Agreement and Plan of Merger dated July 15, 1997, by and among
                  LaserSight Incorporated, Photomed Acquisition, Inc., Photomed,
                  Inc., Frederic B. Kremer, M.D., Linda Kremer, Robert Sataloff,
                  Trustee for Alan Stewart Kremer and Robert Sataloff, Trustee
                  for Mark Adam Kremer (filed as Exhibit 10.31 to the Company's
                  Form 10-Q filed on November 16, 1998*).

    10.28         Exclusive License Agreement dated August 20, 1998, by and
                  between LaserSight Technologies, Inc. and TLC The Laser Center
                  Patents Inc. (filed as Exhibit 10.32 to the Company's Form
                  10-Q filed on November 16, 1998*).

    10.29         Manufacturing Agreement, dated September 10, 1997, by and
                  between LaserSight Technologies, Inc. and Frantz Medical
                  Development Ltd. (filed as Exhibit 10.3 to the Company's
                  Form S-3, Pre-Effective Amendment No. 1 filed on February 1,
                  1999*).

    10.30         Employment Agreement by and between LaserSight Incorporated
                  and Michael R. Farris dated October 30, 1998 (filed as Exhibit
                  10.37 to the Company's Form 10-K filed on March 31, 1999*).

    10.31         Securities Purchase Agreement by and between LaserSight
                  Incorporated and purchasers of common stock dated March 22,
                  1999 (filed as Exhibit 10.38 to the Company's Form 10-K filed
                  on March 31, 1999*).

    10.32         Warrant to purchase 225,000 shares of common stock dated
                  March 22, 1999 by and between LaserSight Incorporated
                  and purchasers of common stock of LaserSight Incorporated
                  (filed as Exhibit 10.39 to the Company's Form 10-K filed on
                  March 31, 1999*).

    10.33         Warrant to purchase 67,500 shares of common stock dated
                  February 22, 1999 by and between LaserSight Incorporated and
                  Guy Numann (filed as Exhibit 10.40 to the Company's Form 10-Q
                  filed on May 17, 1999*).

    10.34         Manufacturing and Marketing Agreement, and Addendum thereto,
                  dated May 14, 1999, by and between LaserSight Technologies,
                  Inc. and Becton, Dickinson and Company (filed as Exhibit 10.40
                  to the Company's Form 10-Q filed on August 11, 1999*)**.

                                      35
<PAGE>

    10.35         First Amendment to Manufacturing and Marketing Agreement,
                  dated October 23, 1999, by and between LaserSight
                  Technologies, Inc. and Becton, Dickinson and Company (filed as
                  Exhibit 10.1 to the Company's 8-K, filed on October 27,
                  1999*)**.

    10.36         Distribution Agreement, dated October 23, 1999, by and between
                  LaserSight Technologies, Inc. and Becton, Dickinson and
                  Company (filed as Exhibit 10.2 to the Company's 8-K, filed on
                  October 27, 1999*)**.

    10.37         Employment Agreement, by and between LaserSight Technologies,
                  Inc. and J. Richard Crowley, dated as of July 3, 1997 (filed
                  as Exhibit 10.43 to the Company's Form 10-Q filed on
                  November 15, 1999*).

    10.38         Employment Agreement, by and between LaserSight Incorporated
                  and Michael P. Dayton, dated November 10, 1998 (filed as
                  Exhibit 10.44 to the Company's Form 10-Q filed on November 15,
                  1999*).

    10.39         Relocation Agreement, by and between LaserSight Incorporated
                  and Gregory L. Wilson, dated October 13, 1999 (filed as
                  Exhibit 10.45 to the Company's Form 10-Q filed on November 15,
                  1999*).

    10.40         Technology Development and License Agreement, dated
                  October 23, 1999, by and between LaserSight Technologies, Inc.
                  and Quadrivium, L.L.C. (filed as Exhibit 10.46 to the
                  Company's Form 10-Q filed on November 15, 1999*).

    10.41         Employment Agreement, by and between LaserSight Technologies,
                  Inc. and Jack T. Holladay, dated October 27, 1999 (filed as
                  Exhibit 10.47 to the Company's Form 10-Q filed on
                  November 15, 1999*).

    10.42         Securities Purchase Agreement by and between LaserSight
                  Incorporated and TLC Laser Eye Centers Inc. dated January 31,
                  2000 (filed as Exhibit 99.2 to the Company's Form 8-K filed on
                  February 8, 2000*).

    10.43         Registration Rights Agreement dated January 31, 2000 by and
                  between LaserSight Incorporated and TLC Laser Eye Centers Inc.
                  (filed as Exhibit 99.3 to the Company's Form 8-K filed on
                  February 8, 2000*).

    10.44         Securities Purchase Agreement by and between LaserSight
                  Incorporated, BayStar Capital, L.P. and BayStar International,
                  Ltd. dated January 31, 2000 (filed as Exhibit 99.4 to the
                  Company's Form 8-K filed on February 8, 2000*).

    10.45         Registration Rights Agreement dated January 31, 2000 by and
                  between LaserSight Incorporated, BayStar Capital, L.P. and
                  BayStar International, Ltd. (filed as Exhibit 99.5 to the
                  Company's Form 8-K filed on February 8, 2000*).

    10.46         Securities Purchase Agreement by and between LaserSight
                  Incorporated, Engmann Options, Inc. and MDNH Partners, L.P.
                  dated February 18, 2000.  The Company undertakes to provide to
                  the Commission upon its request the schedules omitted from
                  this exhibit (filed as Exhibit 10.54 to the Company's Form
                  10-K filed on March 30, 2000*).

    10.47         Registration Rights Agreement dated February 18, 2000 by and
                  between LaserSight Incorporated, Engmann Options, Inc. and
                  MDNH Partners, L.P. (filed as Exhibit 10.55 to the Company's
                  Form 10-K filed on March 30, 2000*).

    10.48         Technology Purchase Agreement dated as of March 8, 2000 by and
                  between LaserSight Technologies, Inc., Premier Laser Systems,
                  Inc. and Eyesys-Premier, Inc.  The Company undertakes to
                  provide to the Commission upon its request the schedules
                  omitted from this exhibit (filed as Exhibit 10.56 to the
                  Company's Form 10-K filed on March 30, 2000*).

                                       36
<PAGE>

    10.49         Employment Agreement, by and between LaserSight Technologies,
                  Inc and Donald M. Litscher dated February 23, 2000 (filed as
                  Exhibit 10.57 to the Company's Form 10-Q filed on May 12,
                  2000*).

    10.50         Amended and Restated Employment Agreement, by and between
                  LaserSight Technologies, Inc. and L. Stephen  Dalton dated
                   effective as of August 1, 2001.

    10.51         Securities Purchase Agreement dated September 8, 2000 among
                  LaserSight Incorporated, BayStar Capital, L.P. and BayStar
                  International, Ltd.  The Company undertakes to provide to the
                  Commission upon its request the schedules omitted from this
                  exhibit (filed as Exhibit 99.2 to the Company's Form 8-K filed
                  on September 22, 2000*).

    10.52         Warrant agreement dated September 8, 2000 among LaserSight
                  Incorporated and BayStar Capital, L.P. (filed as Exhibit 99.3
                  to the Company's Form 8-K filed on September 22, 2000*).

    10.53         Warrant agreement dated September 8, 2000 among LaserSight
                  Incorporated and BayStar International, Ltd. (filed as Exhibit
                  99.4 to the Company's Form 8-K filed on September 22, 2000*).

    10.54         Registration Rights Agreement dated September 8, 2000 among
                  LaserSight Incorporated, BayStar Capital, L.P. and BayStar
                  International, Ltd. (filed as Exhibit 99.5 to the Company's
                  Form 8-K filed on September 22, 2000*).

    10.55         Assignment Agreement dated as of February 27, 2001 among
                  LaserSight Patents, Inc. and Alcon Laboratories, Inc. (filed
                  as Exhibit  99.1 to the Company's Form 8-K filed on March 16,
                  2001*)**.

    10.56         Amended and Restated License and Royalty Agreement dated as of
                  January 3, 2001 by and between LaserSight Technologies, Inc.,
                  Luis A. Ruiz, M.D. and Sergio Lenchig (filed as Exhibit 10.56
                  to the Company's Form 10-K filed on March 30, 2001*).

    10.57         Registration Rights Agreement dated January 3, 2001 among
                  LaserSight Incorporated, Luis A. Ruiz, M.D. and Sergio Lenchig
                  (filed as Exhibit 10.57 to the Company's Form 10-K filed on
                  March 30, 2001*).

    10.58         Loan and Security Agreement dated March 12, 2001 among
                  LaserSight Incorporated and subsidiaries and Heller Healthcare
                  Finance, Inc. (filed as Exhibit 10.58 to the Company's Form
                  10-K filed on March 30, 2001*).

    10.59         Warrant agreement dated March 12, 2001 among LaserSight
                  Incorporated and Heller Healthcare Finance, Inc. (filed as
                  Exhibit 10.59 to the Company's Form 10-K filed on March 30,
                  2001*).

    10.60         Registration Rights Agreement dated March 12, 2001 among
                  LaserSight Incorporated and Heller  Healthcare Finance, Inc.
                  (filed as Exhibit 10.60 to the Company's Form 10-K filed on
                  March 30, 2001*).

    10.61         Employment Agreement, by and between LaserSight Technologies,
                  Inc and Christine A. Oliver effective as of October 30, 2000.

    10.62         Settlement and License Agreement dated as of May 25, 2001
                  between LaserSight Incorporated and Visx, Incorporated.***

                                       37
<PAGE>

    10.63         Securities Purchase Agreement dated July 6, 2001 among
                  LaserSight Incorporated, BayStar Capital, L.P. and BayStar
                  International, Ltd. (file as Exhibit 99.2 to the Company's
                  Form 8-K filed on July 18, 2001*).

    10.64         Series F Registration Rights Agreement dated July 6, 2001
                  among LaserSight Incorporated, BayStar Capital, L.P. and
                  BayStar International, Ltd. (filed as Exhibit 99.3 to the
                  Company's Form 8-K filed on July 18, 2001*).

    10.65         Series G Registration Rights Agreement dated July 6, 2001
                  among LaserSight Incorporated, BayStar Capital, L.P. and
                  BayStar International, Ltd. (filed as Exhibit 99.6 to the
                  Company's Form 8-K filed on July 18, 2001*).

    11            Statement of Computation of Loss Per Share

    15            Copy of letter from independent accountants' regarding
                  unaudited interim financial information

    99            Press release dated August 14, 2001

                  b) Reports on Form 8-K

                  On May 31, 2001, we filed a Current Report on Form 8-K
                  including a press release announcing that we had resolved
                  litigation with Visx, Incorporated and entered into a
                  Settlement and License Agreement.

---------------------------
*    Incorporated herein by reference.  File No. 0-19671.
**   Confidential treatment has been granted for portions of this document. The
     redacted material has been filed separately with the commission.
***  Confidential treatment has been requested for portions of this document.
     The redacted material has been filed separately with the  commission.

                                       38
<PAGE>

                                   SIGNATURES
                                   ----------

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the undersigned have duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                    LaserSight Incorporated



Dated: August 14, 2001              By:  /s/ Michael R. Farris
                                         ----------------------
                                         Michael R. Farris,
                                         Chief Executive Officer



Dated: August 14, 2001              By:  /s/ Gregory L. Wilson
                                         ---------------------
                                         Gregory L. Wilson,
                                         Chief Financial Officer

                                       39